Portuguese shoe firms create too many jobs to be SMEs
19/02/2015
Funding from the European Union is available for the government in Lisbon to use to support manufacturers and, traditionally, the Portuguese government has invested in export promotion to improve the country’s balance of trade. This is part of a wider support programme called Programa 2020.
Footwear is a great export success story for Portugal and, in recent comments, deputy prime minister Paulo Portas congratulated the industry on export growth of 60% in the last seven years and said he was confident Portuguese footwear exports would break through the €2 billion barrier in 2015. Around 95% of all the shoes produced in Portugal are exported at the moment.
One of the reasons for this success has been support from the government for export-promotion initiatives such as taking part in footwear exhibitions overseas. Portuguese firms have, in some cases, been able to receive 75% funding for activities of this kind.
This is likely to stop now because the government wants to focus Programa 2020 funding on small and medium enterprises (SMEs). The footwear industry has argued that practically all of the 1,800 companies in the sector in Portugal are small or medium-sized, but because footwear is a labour-intensive industry, many of these employ more than 250 people, which the government has established as a cut-off point to define what is and is not an SME.
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