EU funds, last train to competitiveness

BarcelonaThe European Union (EU) funds are the great opportunity. All experts consulted by the ARA agree that they are the opportunity to transform the Catalan and Spanish industry to make them more competitive. "Those who will benefit the most are the value chain of the industry", Fàtima Vidal, professor at the UPF, says. But there are still doubts in all sectors about who can benefit and how they will be awarded. Only the main lines are known, and SMEs, which have suffered greatly from the crisis caused by the pandemic, fear that a large part of this money will go only to large corporations.

Amid doubts and criticisms between the Spanish and Catalan governments over who will select the projects that opt for this fund and who will manage them, the Government has already chosen the first 27 Catalan projects, which if they go ahead would mobilize an investment - between European funds, the contribution of other administrations, and the investment of companies - of 41,355 million euros. They are projects that, following the parameters of the recovery plan, are basically focused on the ecological transition, digitization, and knowledge society and health.

The employer Pimec has polled its partners about these funds basically on the procedure to follow to access them. Only 30% of Pimec companies are considering submitting a project to capture these grants. Hence why the Secretary for Economic Affairs and G20 of the Spanish Government, Manuel de la Rocha, insists on the importance of the so-called PERTE (strategic projects for the recovery and technological transformation), which should be "tractor projects that drag the entire value chain". "It is difficult for small companies to benefit", disagrees Professor Fàtima Vidal.

At the moment, the administration of Madrid has already marked the four main axes towards which these funds will be directed: green and sustainable economy, digital transformation, territorial cohesion and inclusion, and the fight against the gender gap.

To situate ourselves, we must know the scope of these funds. Spain will be the most benefited state, with more than 140,000 million euros until 2026, half in direct funds and the other in credits. The funds will probably not start to arrive until the second half of this year. But the Spanish government has already included them in the 2021 budgets so that they can be made available. They are 26,634 million euros for 2021. A figure that is approximately equivalent to the annual budget of the Generalitat. The most important part (5,623 million euros) is aimed at industry and energy, and in infrastructures and resilient ecosystems (4,752 million), which include R + D + I and digitization.

Interest

More than 750 projects have already reached the Ministry of Industry

Despite the general lack of knowledge about how the funds will be articulated, companies are looking for them. The Minister for Industry, Reyes Maroto, announced a few days ago that more than 750 applications had been received within the recovery plan to access the funds, called Next Generation. These applications could mobilize 30,000 million. But Manuel de la Rocha has made a clear warning to companies that want to access these funds. "They are not designed to finance the business plans of companies", but must be transformative projects for the economy.

Bureaucracy

Businesses must be vigilant, because there is no one-stop shop

"There will not be a one-stop shop", De la Rocha explains. Although he argues that the process will be competitive, competitive and transparent, entrepreneurs who want to raise funds must be attentive to the calls, which will come from different ministries, public agencies, communities and even municipalities.

The management of the funds will be audited by the EU. Pedro Sánchez reserves the last word, but there is one aspect that stands out: "Spain is one of the countries with the worst ratio when it comes to getting European funds", according to Natán Díaz, head of public sector at KPMG.

Green Europe

Renewable and green hydrogen projects are essential

As of January 20, only five expressions of interest had been published, the first step in indicating the topics for which funds are wanted. The first of these concerns projects for a just and inclusive energy transition.

"Sustainability and decarbonisation will be one of the main axes of the projects to be presented by the companies", says Fàtima Vidal. The main electricity companies have already announced heavy investments in the hope of attracting funds. The Secretary of State for Economy and Business Support, Ana de la Cueva, admitted that these funds "are a unique opportunity to boost investment and address reforms". De la Cueva highlighted three clear lines: reforms in the production process, investments in decarbonization, and promotion of the circular economy.

Companies are moving to access funds. For example, Repsol and Endesa have already presented green hydrogen projects. But "it is not about changing the whole industry, but about changing processes that help decarbonization", Fàtima Vidal points out.

Digitalization

Technologies see a great opportunity for the 5G

The telecommunications sector does not want to be left on the sidelines. Another expression of interest comes from this sector, with the intention of extending broadband and 5G technology to 100% of the territory, even to the so-called emptied Spain. "Digitalization will change many of the current processes and will avoid a lot of mobility", says Vidal. A clear example is e-commerce, driven precisely by the pandemic.

The new mobility

Electrification of the car fleet and part of the infrastructures

The automobile sector is one of the first to make a move. On the one hand, to promote the decarbonization and digitalization of factories to be more competitive, but also to promote the transition to the electric car, says José López-Tafall, director general of the employers' association Anfac. In addition, he stresses, a large public access charging infrastructure must be developed because "Spain is at the tail end of Europe".

Construction

Infrastructures and rehabilitation

Construction also wants to be part of these funds, with two axes: the promotion of infrastructures -for example, the Mediterranean corridor- and the rehabilitation of housing, to make them more sustainable and efficient. "Construction must be one of the main machines of the recovery process", the Chamber of Contractors of Works of Catalonia indicate, and appeals to the essential role the sector has had in exiting other crises.