By Chris Graeme
Existing road and rail transport projects that have already been approved will go ahead, Portuguese Minister for Transport and Public Works António Mendonça confirmed last week.
The Minister was addressing a group of businessmen linked to the Institution of Civil Engineers (ICE), the Chartered Institute of Building (CIOB), the Royal Institution of Chartered Surveyors (RICS) and members of the British-Portuguese Chamber of Commerce (BPCC) at a BPCC organised dinner at the British Ambassador’s Residence in Lisbon.
António Mendonça said that the government’s TGV high-speed rail link project between Madrid and Lisbon, Lisbon and Porto and Porto and Vigo was not “a whim” or a “luxury toy”.
He said that Portugal’s existing rail infrastructure, the base of which had been developed to meet needs in the late 19th century, was already “exhausted and obsolete” and had never really been “modernised”.
“Our system is out of date and cannot meet the export demands of the current market to the rest of Europe and European economic centres such as Madrid and Paris,” he said.
“It is important, in terms of rail freight, to have a new, modern and fast system to meet future needs, a rail network that was both an integrated passenger and freight network with links to Portugal’s industrial freight ports such as Sines, Leixões and Lisbon as well as the new passenger and cruise ship terminal planned for Santa Apolónia in Lisbon,” he said.
The minister stated the belief that Portugal could be the “face of Europe”, a gateway to markets in the United States, Latin America and Africa.
This was particularly important given that port imports and exports as well as cruise ship passenger levels had shown some signs of “increased activity” and infrastructure modernisation projects would help put Portugal on the map as a major reception centre for new ships.
“We must be prepared to adequately cater to the millions of tourists who pass through our ports each year on one of the main European cruise routes” to the Mediterranean and North Africa and to Madeira, the Azores and on to Brazil, he added.
He said it was important to improve port interfaces and interlinks with other forms of transport so vital to Portugal’s success at developing a competitive edge.
Giving an example of the importance of modernising freight routes with the TGV, he said that currently it costs 300 euros to ferry the average freight container by rail to a destination outside of Portugal. With the high speed rail link, that same container would cost less than 100 euros.
António Mendonça stressed that the TGV was “absolutely profitable” and had a cost-profit ratio benefit of 5.9 per cent, three per cent above that of Spain while the concession was worth around 280 million euros.
“The TGV is not just a Portuguese project. This is a joint Portuguese-Spanish venture that has been planned by various governments over many years and is seen as a priority project by the European Union,” he stressed.
The Minister also said it was a mistake to think that it was a totally public funded project, when in fact it was a Public Private Partnership project with 90 million euros from the 1.5 billion euro total coming from private sources as well as money from the European Union.
“I see no reason to abandon this project, planned down to the smallest detail for so many years, when all the financing is in place already. The liquid impact in terms of costs to the taxpayer is only 0.015 per cent spread out over 15 years,” he argued, adding that the Government could up its financial capacity if needs be since other infrastructure projects had been put on ice.
He also mentioned the importance of the third River Tejo Bridge bringing rail services both from the new International Airport and the TGV into Lisbon as part of a “cohesive project” worth 20% in increased revenue receipts from passengers, freight and concessions.
The Minister also spoke of the importance of Lisbon’s new International Airport, which was not “a question of prestige or caprice but competitive and capacity need” and a project that had been 40 years in the making, since the ill-fated government of Marcelo Caetano in the early 1970s.
At that time, a project was to have gone ahead at Rio Frio relatively near Lisbon but the project didn’t get off the ground because Salazar’s successor had family with land interests in the area.
The estimated cost of the new Lisbon International Airport is put at 3.5 billion euros in the initial phase including the cost of rail and road access and compensation that will have to be paid to landowners and the costs of relocating the military shooting range in the Alcochete area.
“For those who talk about Portela or Portela +1, I would remind them that various studies have shown that Lisbon airport can no longer meet demand, particularly at rush-hour times. There are 5,000 slots available and we simply don’t have the capacity for that or the three million passengers projected to reach seven million per annum over the next few years,” he said.
Passenger numbers were slated to increase by 8.9 per cent by 2018, which meant that if the new airport wasn’t up and running by then, 600,000 passengers would be denied access annually to Portugal which would have a “damaging image for the country and a disastrous economic impact for Portugal”.
In a nod to Portugal’s current budgetary and economic problems, he stressed that dealing with short term problems was one thing, but that infrastructure investment was vital for Portugal’s modernisation, productivity and competitiveness in the medium to long term.
“We can’t keep chopping and changing our plans which were thought out over many years. It would be disastrous for the long-term success of our economy and stability, not just in terms of our construction industry but also our Small and Medium Enterprises, foreign direct investment, companies wanting to relocate to Portugal and future jobs,” he concluded.
