Investments underwritten by the Regional Government diminished by 21 million Euros in 2008
The total value of guarantees granted by the Regional Government to public sector companies decreased 21 million Euros in 2008 when compared to the previous year, reaching a total figure of 397 million Euros. According to the Vice-President of the Regional Government of the Azores, this is a “very significant reduction” that is consistent with the “tendency of past years.”
Sérgio Ávila emphasised that already in 2006 there had been a decrease in the total value of governmental guarantees, in the order of 4.1 million Euros in relation to the previous year.
He added that ever since, the Regional Government of the Azores has succeeded in lowering the funds committed to such guarantees by 25 million Euros, lowering the total amount to the figure of 397 million Euros, thus “consolidating a decreasing tendency, unlike what is happening in the Autonomous Region of Madeira and in the country as a whole.”
In the view of the Vice-President, this positive economic indicator reveals the “financial and economic solidity of the public entrepreneurial sector of the region.”
Concerning the execution of the 2008 Budget, the Vice-President said that the Regional Government granted 32.4 million Euros as loans and debt-service assistance to the public companies of the region. With regard to the concession of new grants, he added that the Regional Government has only approved a bank guarantee in the order of 11.4 million Euros.
He said that these financial operations “in net terms, brought about a 21 million Euro reduction in the debts of public companies, a reduction which reflects the policies of financial discipline and rigour adopted by the Regional Government vis-à-vis regional public finances.”
He added that the granting of financial assistance to public sector companies in the “Region has been exemplary, particularly in relation to the granting of governmental financial assistance, which falls below legally imposed standards, unlike what is happening in the Autonomous Region of Madeira and in continental Portugal.” He also said that the granting of financial assistance in 2008 “corresponded to what was presented and proposed at the Legislative Assembly of the Azores, when the Budget was debated. This shows, once again, that the present Regional Government of the Azores honours its pledges.”
The Vice-President said that the present international economic conjuncture and the liquidity difficulties of financial institutions made it imperative for governments to intervene on a global scale to induce the exchange of capital and the release of financial resources so as to stimulate the economy, an aim that is shared by the Regional Government of the Azores.
In this context, and recognising the lack of confidence in the international financial markets, “the excellent international rating of the regional public finances is a comparative advantage and a valuable instrument that should be used to provide the Azores with additional financial mechanisms with which to combat the negative effects of the present international economic-financial conjuncture.”