By the end of this year, the Municipality of Lagos will pay 2.368.421 euros, an amount to be repaid from the outstanding capital relating to the PAEL – Local Economy Support Program, the municipality has just announced.
The PAEL application and the respective Financial Adjustment Plan for the Municipality of Lagos were approved by the Government at the end of 2012. The amount of funding allocated to the Municipality of Lagos was set at 9.508.643,58 euros and had a deadline of 14 years payment.
"Five years later, in 2017, with the payment of this amount, the Municipality thus amortizes, and in advance, the outstanding capital, always maintaining the concern and the objective of reducing taxes", explains the municipality, in a press release.
For Maria Joaquina Matos, Mayor of Lagos, «the last few years have been years of causes, commitments, incentives, achievements, consolidation and strengthening», and, above all, «of cohesion in favor of our municipality and of our citizens'.
Lagos' adhesion to the Local Economy Support Program was motivated by the «financial difficulties of the municipality, due to the sharp drop, as of 2008, of its main sources of revenue, mainly from IMT, licensing of works and spills», recalls the autarchy.
The main objective of the PAEL was to settle debts overdue for more than 90 days, registered at the General Directorate of Local Authorities, on March 31, 2012.
As the name of the program indicates, this extraordinary financing was intended to inject financial resources into local companies and families, honoring the municipalities' past-due commitments to their service providers and suppliers.
With the operationalization of this program and the financing it instituted, «allied to a great rigor and austerity in municipal management, the municipality managed to obtain financial means to face its treasury liabilities, at an interest lower than that practiced at the time by financial institutions and much lower than the default interest on debts owed to suppliers and service providers».
On the other hand, «short-term debt, overdue and payable, was converted into long-term debt, alleviating the municipal treasury in times of crisis and increased difficulties in which the Chamber had to face an increasing number and each time largest number of requests».
Five years after this Government support, the Municipality of Lagos “is able to repay all its debt related to the PAEL”, concludes the municipality.
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