As we are entering a period of intermittent confinement, as we will have to slow down, let's take this opportunity to think a little about our common future.
These strange and unforeseen times that we are living are highlighting the absolute need to diversify the Algarve's economic base. The Algarve's super specialization in the tourism and leisure value chain, with all related and interdependent activities, such as transport, real estate and construction, led to a scenario of authentic economic catastrophe in which it is demonstrated how vulnerable the Region is in times. of crisis.
I'm not going to elaborate on statistics, because Professor Luis Coelho has already done so clearly, in a text that is perfectly up-to-date.
It should be noted that this crisis is different from all others. The covid-19 crisis is identified, above all, as a crisis in services, and several international studies do not hide the fact that a delayed recovery awaits us.
It is quite evident that the Algarve is a region very dependent on the outside and is subject to the dynamics of activities over which it has no control, such as, for example, the case of air transport, which is one of the most affected sectors. worldwide, with several companies dropping their planes on the ground.
The equation is simple: without air transport there are no tourists and without tourists the regional economy is reduced to less than 50% of what it would be if tourism were operating normally.
The medium-term future is worrying: international agencies admit that next summer may even be reasonable, like this last one, but it will not be enough to recover, being more prudent to do the math thinking about the return of the dynamics of 2019 towards 2022 or 2023.
In recent weeks, the presidents of AMAL and CCDR have come out publicly defending the need to diversify the region's economic base. The idea, of course, is valid and more pertinent than ever, but let's face it, it's not completely new.
One of the first regional development plans promoted by the CCDR in the mid-80s already pointed the finger and proposed the diversification of the regional economic base. We were, then, just a few years away from starting to receive aid from Portugal's accession to the EEC (1986). Then, as today, it is the vision of access to European finance that promotes unity around the elaboration of an allegedly strategic investment plan at the regional level.
As every shift politician likes to leave his mark, whoever came next decided to shelve the path to diversification. In the plan that served as the basis for the 2000-2006 Community Support Framework, the so-called Axis 1 of the strategy even proposed “to assume with determination the specialization in the complex of Tourism/Leisure activities as the driving force and catalyst for economic growth in the Region ”. And it was stated that “this option implies, in the long term (…) breaking with the mirage of a diversification of activities that is always postponed (seeking to have “a little of everything”).
At the time, it was written that “the diagnosis carried out and the challenges posed draw strong probabilities for the opening of a cycle of renewal and change that establishes the contours of a new strategic development model for the Algarve's economic base”.
Those who are curious can access the various plans that have served as the basis for the regional strategy, at least those published with reference to QCA III (2000-2006), QREN (2007-2013), CRESC 2020 (2014-2020), available in the CCDR digital library by clicking here. Previous versions, only on paper in some library or documentation center.
Recent news shows that AMAL is developing this Plan, which may contribute to diversifying the regional economic base, with support from the Faculty of Economics of the University of Algarve and an international consultant. It's a good new.
The projects that are approved in this Recovery Plan will reflect the concern and expectations of the 16 municipalities of the Algarve in various areas (namely health, housing, mobility, climate change) and will have to be implemented by 2026.
It remains to be seen what these projects are and whether they actually have regional objectives or whether there are going to be 16 sets of local projects.
We will believe, until we see, that the projects in question actually have the objective of preparing the region for the future, making it more resilient and with more diversified areas in its economic base, not just being dependent on tourism and real estate. It is necessary to save companies in the region, value the local economy and create conditions for the sustainability of their jobs.
European Union funds, whether the so-called Next Generation (created to respond to the pandemic) or those provided for in the Community Framework 2021-2027, will be crucial.
The moment in which these funds will be available to companies and to the various bodies will be decisive for accelerating the recovery of the economy.
It would be important for someone to be concerned about streamlining the mechanisms for managing these financings. Too much time to inject this money into the economy can be fatal for many companies and, as a result, for jobs and the sustainability of families.
Author Paulo pereira
Member of the Order of Economists
Paulo Pereira has a degree in Financial Management from ESGHT and a postgraduate degree in Corporate Finance from FEUALG. After several collaborations in the regional press, he became the representative of Semanário Económico in the Region until it became a daily newspaper. About 25 years ago he founded NEOMARCA, where he works as a consultant for companies, specializing in the area of investment support and incentives, including two stints in public functions in Vila Real de Santo António and Portimão. He was part of the Fiscal Committee of the Chamber of Commerce and Industry of Portugal and was a member of the governing bodies of BICS – Association of Portuguese Business and Innovation Centres.
Note: article published under the protocol between the Sul Informação and the Algarve Delegation of the Order of Economists
Help us to do the Sul Informação!
Contribute your donation so that we can continue to make your journal!
Click here to support us (Paypal)
Or use our IBAN PT50 0018 0003 38929600020 44
Comments