19 Jul 2017
Industrial vocation of the Northern region with new dynamism
The construction, expansion and modernization of factories concentrates most of the € 665 million of support granted to SMEs under the NORTE 2020 Community Support Program.
The fifth most industrialized region of the European Union-15, Northern Portugal is gaining a new impetus in its industrial vocation, according to the most recent NORTE 2020 performance data. According to CCDR-N (North Coordination and Regional Development Commission), which manages this operational program and which has presented the list of investment projects approved as of 30 June, there is "a greater prominence of small and medium enterprises".
These companies secured € 665 million in support under NORTE 2020, which is aimed "mainly at the construction, expansion or modernization of factories", although it also includes projects of internationalization or launching of new companies. The previous balance sheet carried out by CCDR-N at the beginning of the year (related to the execution at the end of 2016), stated that the investment item in the construction and / or expansion of new production units concentrated more than 320 investment projects, in a total of € 372 million, which, according to this entity "reflects a new dynamism in the industrial vocation of Northern Portugal."
The manufacturing sector - which includes textiles, machinery and electrical equipment and footwear - is one of the main economic drivers of the region, also known for its exporting vocation: about 45% of the national exporting companies are located in the North, where the volume of exports amounts to around 17 billion euros, according to CCDR-N. This sector of the Northern economy was actually the "engine being the growth in apparent labour productivity in the period between 2008 and 2015, with high gains in competitiveness, especially in the apparel and textiles industry," says the same entity in an analysis of the Region regarding the last 10 years.
In the same document, it is also mentioned that this sector was one of the main contributors for the region becoming the main "driver of productivity growth in Portugal" during the period of economic recovery. In an analysis of the statistical data gathered during the 10 years of the Norte Conjuntura report, "it can be concluded that the apparent labour productivity of the Northern region was the fourth largest in Portugal in 2015 and grew by 6.5% between 2008 and 2015, above the national average".
The "manufacturing sector stands out clearly with a relative contribution of 7.3%. Without this contribution, the total productivity of companies in the Northern region would have declined instead of the actual 6.5% increase", the report states. This area was also responsible for the recovery of investment in the region, which, after a 50% fall between 2009 and 2012, continued to grow steadily.
Foreign investment is also growing
In addition to the vitality of the national business fabric, foreign investment is also growing in the North, according to a report by EY Consultants. The region was even more dynamic in attracting Foreign Direct Investment (FDI) in 2016, leading both in the number of projects and jobs created in Portugal . According to the "Attractiveness Survey Portugal - 2017" report, the North hosted 21 FDI projects in 2016 (36% of the 59 registered at national level) and generated 1,529 jobs with these investments (63% of the 2,500 created in Portugal).
Within the regional context, the report highlights Santa Maria da Feira, the city with the highest number of jobs generated in Portugal, followed by Bragança, with 400 jobs. In the first case, the investment of about € 60 million from the American food company Amy's Kitchen stands out, with a new rapid vegan meal manufacturing facility coming in 2018 to supply the whole of Europe, creating 600 jobs.
In the case of Bragança, one of the investments received in 2016 was the second factory of Faurecia, one of the world's largest automotive equipment manufacturers, which invested € 41.5 million and created 400 new jobs. The two investments are good examples of the sectorial trend of FDI, as 59% of the projects and 76% of the work posts generated in 2016 are related to "manufacturing activities, being projects that mainly target external markets, counting on the country's logistic infrastructures", EY concludes.
The fifth most industrialized region of the European Union-15, Northern Portugal is gaining a new impetus in its industrial vocation, according to the most recent NORTE 2020 performance data. According to CCDR-N (North Coordination and Regional Development Commission), which manages this operational program and which has presented the list of investment projects approved as of 30 June, there is "a greater prominence of small and medium enterprises".
These companies secured € 665 million in support under NORTE 2020, which is aimed "mainly at the construction, expansion or modernization of factories", although it also includes projects of internationalization or launching of new companies. The previous balance sheet carried out by CCDR-N at the beginning of the year (related to the execution at the end of 2016), stated that the investment item in the construction and / or expansion of new production units concentrated more than 320 investment projects, in a total of € 372 million, which, according to this entity "reflects a new dynamism in the industrial vocation of Northern Portugal."
The manufacturing sector - which includes textiles, machinery and electrical equipment and footwear - is one of the main economic drivers of the region, also known for its exporting vocation: about 45% of the national exporting companies are located in the North, where the volume of exports amounts to around 17 billion euros, according to CCDR-N. This sector of the Northern economy was actually the "engine being the growth in apparent labour productivity in the period between 2008 and 2015, with high gains in competitiveness, especially in the apparel and textiles industry," says the same entity in an analysis of the Region regarding the last 10 years.
In the same document, it is also mentioned that this sector was one of the main contributors for the region becoming the main "driver of productivity growth in Portugal" during the period of economic recovery. In an analysis of the statistical data gathered during the 10 years of the Norte Conjuntura report, "it can be concluded that the apparent labour productivity of the Northern region was the fourth largest in Portugal in 2015 and grew by 6.5% between 2008 and 2015, above the national average".
The "manufacturing sector stands out clearly with a relative contribution of 7.3%. Without this contribution, the total productivity of companies in the Northern region would have declined instead of the actual 6.5% increase", the report states. This area was also responsible for the recovery of investment in the region, which, after a 50% fall between 2009 and 2012, continued to grow steadily.
Foreign investment is also growing
In addition to the vitality of the national business fabric, foreign investment is also growing in the North, according to a report by EY Consultants. The region was even more dynamic in attracting Foreign Direct Investment (FDI) in 2016, leading both in the number of projects and jobs created in Portugal . According to the "Attractiveness Survey Portugal - 2017" report, the North hosted 21 FDI projects in 2016 (36% of the 59 registered at national level) and generated 1,529 jobs with these investments (63% of the 2,500 created in Portugal).
Within the regional context, the report highlights Santa Maria da Feira, the city with the highest number of jobs generated in Portugal, followed by Bragança, with 400 jobs. In the first case, the investment of about € 60 million from the American food company Amy's Kitchen stands out, with a new rapid vegan meal manufacturing facility coming in 2018 to supply the whole of Europe, creating 600 jobs.
In the case of Bragança, one of the investments received in 2016 was the second factory of Faurecia, one of the world's largest automotive equipment manufacturers, which invested € 41.5 million and created 400 new jobs. The two investments are good examples of the sectorial trend of FDI, as 59% of the projects and 76% of the work posts generated in 2016 are related to "manufacturing activities, being projects that mainly target external markets, counting on the country's logistic infrastructures", EY concludes.
Source:
In, Público