Getting Portugal into the game...

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Tuesday we visited the Agencia Portuguesa para o Investimento (API), a government organization responsible for investment promotion, and ICEP Portugal, a government organization responsible for export promotion. Wednesday we visited Mota-Engil (a construction company), had lunch with MBA students from the University of Porto, and had two lectures at the university (acquisition strategies by Portuguese companies and inward & outward investment in Portugal).

I was looking forward to getting a little bit of introduction on the Portuguese economy and initiatives since joining the EU (like we did in Dublin), but things here don't seem to be nearly as organized as in they are in Ireland. Portugal just doesn't quite seem to have their act together when it comes to advancing its economy and making itself competitive within the EU. Granted, they started out pretty low and have made some progress, but a lot of people in our class have expressed the sentiment that everyone seems to just be making excuses for why they haven't done more. It's almost like being a teacher and having to deal with that one kid who has so much potential but just couldn't care less. I think we're all finding it a little frustrating (especially having come straight from Ireland) to look at ways that we feel Portugal could generate so much potential and then to hear the people here say stuff like, "well, we're just a small country" or "it takes a while to get things done around here."

Take education, for example: Ireland has put a HUGE emphasis on education and training to develop the skills of its workforce (most, if not all, of the companies we talked to mentioned the high-skilled labor as a plus for operating in Ireland) and has intiated incentives for companies generating R&D. Portugal has competed in the past based on low-cost labor ... considering that Central and Eastern Europe and Asia are entering the picture and dominating the low-cost labor/manufacturing market, you would think Portugal would want to advance itself on the value-added chain and move into higher value sectors/industries. They mentioned this a couple of times over the past couple of days, but when asked about it, they say that there is no national program to advance education and turn out more science, engineering, etc. degrees. And most of their investment has historically been in former Portuguese colonies - they don't seem to be making much effort to proactively generate trade/investment (not compared to Ireland anyway).

One speaker gave a presentation on Adira, an engineering company that sells sheet metal working machinery. He talked about obstacles for Portuguese exporters and mentioned that it was difficult to work with the State and Banking systems and that universities are still not willing to get into co-op programs with local companies. This is the complete opposite of Ireland, where the government is very responsive to and supportive of companies (both domestic and foreign) and promotes cooperation between universities and corporations. When someone in our group asked whether the government was responsive to the needs of local companies and state agencies trying to promote investment, the speakers just said, "you have to be patient," and seemed really reluctant to say anything about the government. Now, granted we WERE talking to a state agency, but it makes me really wary when people are reluctant to speak negatively about their government. (We also found out later that the privatization of a lot of industries to remove them from government control didn't start until 1997!!) It almost seems a little Communist-esque to me. One question I kept asking myself is, "What did Portugal do with all of the EU funding they received?" (Ireland threw theirs into education and innovation.) One of the MBA students told us that a lot of companies wasted the funding by buying Ferraris and whatnot. So, maybe it's because we've just come from Ireland, the model of economic recovery for the EU, but it seems that Portugal is in a lot of denial, is very slow to implement anything (whether that be from the more laid-back culture or a general risk-averse attitude), and doesn't really seem to care that other countries are going to out-compete them and steal investment from right under their nose.

OK, so I realize that it sounds like a lot of really negative stuff about Portugal. But I DO like Porto - it has tons of character and beautiful buildings!! The city itself is better than Dublin (mostly because of the character and because it's a different culture), but the government and education could take a few lessons from Ireland. I think we're all just kinda frustrated by the fact that they're so nonchalant about the potential we think they're missing. Like I said, it could be because we just came from Ireland, the example that all developing countries are trying to follow and the most successful story in the EU thus far, but we'll see if our opinions change any after we visit some more companies.

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Comments

[Aunt Marilyn]

Portugal
Well, I see someone's been working on her paper! It's great hearing your perspective and the wonderful descriptions of the places you visit! I always look forward to your blogs. Have a great time for all of us! Love you, - Aunt Marilyn

[Aunt Marilyn]

Pen Pals
I hope you're getting some contact names for these companies! You never know when you'll need 'em...! I'm sure the folks in Ireland would love to hear your comparisons of the different countries, too! - Aunt Marilyn