Portugal to Utilize Compete and Development Bank to Aid Companies in Trade War
The Ministry of Economy is set to create a monitoring group in response to rising tariffs in the U.S.. Pedro Reis, the Minister of Economy, disclosed the most affected export sectors and warned about the impact on intermediate consumption during interviews with CNN, Antena 1, and Rádio Observador.
Support Measures in Development
Portugal is formulating a plan to combat the trade war, including support measures through Compete and the Development Bank. Pedro Reis emphasized that the ministry has been discreetly assessing sensitivities but will now make these interactions with companies and associations more public.
To assist the most affected sectors, new notices under Compete are being designed. Additionally, the Development Bank will provide support through guarantees and funding aimed at industrial equipment and enhancing internationalization. Reis stated, "This is the direction we need to pursue."
Awaiting European Union Coordination
The minister highlighted the necessity of waiting for the European Union to coordinate on this matter, stating that there are already some measures prepared at the national level. He pointed out that some aspects, particularly concerning the steel industry, need re-evaluation to protect European industry against non-tariff quotas.
Impacted Sectors
Reis warned of the short-term damage from escalating tensions, identifying the national sectors most sensitive to U.S. tariffs:
- Chemical industry: Exports 30% to the U.S. (worth €5 billion)
- Fuels: 20% exported to the U.S.
- Machinery and appliances: 10% exported
- Plastics and rubber
Additionally, he noted that the textile and agri-food sectors, including wine and olive oil, will be closely monitored.
Broader Consequences
The minister cautioned that it’s not just national exports to the U.S. that will be affected. If the EU imposes excessive tariffs in retaliation, national intermediate consumption could rise, adversely impacting various domestic sectors.
Pedro Reis mentioned ongoing discreet contacts with several sectors to gauge potential impacts, particularly in the agri-food chain, plastics, optical fibers, automotive components, and other manufactured goods. He advocated for a firm yet intelligent approach from the European Commission, stressing that responses should be proportional and consider the specific sectors most affected.
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