The US Stimulus Plan (American Recovery and Reinvestment Act of 2009) undoubtedly opened the eyes of many Iberian companies to current and future investment and development opportunities in the country
With public resistance to increased taxation, cash-starved federal, state and local authorities are looking for new means and ways of funding the investment shortfall, says Fernando Alonso, banking and finance partner with Hunton & Williams in Miami.
In addition to the uncertainty surrounding the viability of certain publicly-funded projects, there is also concern around the ability of Portugal’s existing project finance regulation to cope with many of the issues now being raised as a result of the financial crisis, says Jose Luis Esquível of Lisbon public law specialists Esquível Abogados.
As Government cuts and financial uncertainty impact on the viability of projects, groups of companies are now seeking to negotiate better contract and concession terms
Consortia members who had successfully bid for now cancelled or postponed projects have to consider all the options available to them
The Portuguese government may have suspended many of the planned most high profile infrastructure projects but sector players need not limit themselves to merely domestic opportunities, insists Jorge Sarmento Neves, partner with Gómez-Acebo & Pombo in Lisbon.
The onset of the banking crisis in 2007 has prompted a reduction in both the number of project finance deals, the scale of those going ahead, and a much more objective calculation of benefits by lenders
Among the initial responses to the financial crisis in Portugal and Spain was a strong emphasis on project and construction schemes, intended to inject liquidity and momentum into the national economies. New or long-awaited project and construction schemes were announced, or brought forward.