GUILLERMO FERNANDEZ VARA
2007Junta de Extremadura
Junta de Extremadura
Health & consumer affairs minister
Junta de Extremadura
Social welfare minister
Junta de Extremadura
Director general of public health & consumer affairs
Q What do you consider Extremadura’s competitive advantages compared with other Spanish regions?
A Until 24 years ago, when we gained our autonomous status, Extremadura was a much misunderstood region. Today, investors are finding out that our region offers an abundance of space and a high growth potential. Firstly, I would point to our geographic location. In the past, we were something of a cul-de-sac on the periphery of Spain. Following Spain’s accession to the EU in 1986, we find ourselves a crossroads of various locations. We are the mid-point of a market of 20 million people within a couple of hours from any part of Extremadura, whether it be Madrid, Lisbon or Seville. In the past, our back was turned to Portugal but now it is a prime export market, opening new horizons. This means we belong to a bigger entity, which is accessible because of improved communications.
Q What can the regional government offer investors who are interested in coming to Extremadura?
A Basically, we offer land and financial assistance. We provide investors with free industrial sites and only charge for development costs, such as power connections. We can guarantee financial assistance of about 25% of investment costs, depending on the project. We also offer political and industrial stability. There is a strong spirit of co-operation here among employers, unions and the regional authorities, who govern with a comfortable majority. The average wage scale is lower than the rest of Spain because the cost of living is also below the national average. Therefore, we can point to an attractive combination of social and political stability, government incentives and the potential of an emerging market.
Q What are your priorities with regard to sectors for development?
A Basically, we want to promote industrial sectors. About 25 years ago, agriculture accounted for 30% to 40% of Extremadura’s economy, though we are now much closer to the Spanish average, while the service sector has grown to represent 58% of our regional GDP. There is a significant differential with the Spanish economy in two basic areas. The construction sector in Spain is 15% of GDP, while in Extremadura it is only 10%. On the other hand, our agricultural output is still relatively higher than the rest of Spain. We therefore see a tremendous growth potential in industry and in the service sector, and when I speak of industry, I am also talking about agricultural mechanisation.
Q Do you have any specific plans to boost Extremadura’s image abroad?
A One of our problems is a lack of penetration in the rest of Spain as well as foreign markets. There are a lot of clichés about Extremadura, although most of them are relics from the past. The region was once considered a desert wasteland, but the reality is that people who come here now realise that this is a green region. We have more miles of inland coastline than any other region of Spain. We are therefore a net exporter of electricity. Our consumption amounts to 1.7% of Spain’s total, while our production is 8.5% of all the electricity generated in the country. In fact, we produce seven times more energy than we need. This is one example of dispelling the old myths of Extremadura.
Q What specific initiatives are you taking to spread this message to investors?
A We have launched a project called Marca Extremadura (Extremadura Brand) through which we sell the region’s image to the world to bring the reality of Extremadura to investors everywhere. We, of course, use the standard channels of trade and industrial fairs but we have also opened a number of trade offices and there are plans to inaugurate new ones in Mexico, Poland and Russia.
Q Which markets have the greatest potential for Extremadura?
A We have recently been putting a lot of effort into selling Extremadura in south-east Asia, the new EU accession countries and Latin America, which represents the third leg of this tripod. We certainly cannot ignore the Latin American market, with which we share a common culture and language. The fact that China and the US have opened their doors to our famous cured ham opens an enormous export market. The challenge now is to ensure that our exporters have the capacity to respond to this situation.
Q Is Extremadura’s transport infrastructure system able to meet this challenge?
A Not if we wish to grow at the rate we envisage. With this in mind, we have outlined a project called the Second Step. Our plan is to spend €13bn over the next few years to launch 15 investment schemes, amongst which transport is one of the top priorities. The project also includes water treatment plants and housing, including the refurbishment of half of the region’s 42 castles, a key attraction to tourists.
Q Do you see potential in the tourism sector?
A I would say that tourism is one of the most promising areas within the service sector. We need to offer better services and ensure that tourists spend more time here on their visits. Until recently, the tendency was to spend a night or two in Cáceres, Mérida or another such centre.
Tourists generally returned after visiting one spot because of a lack of adequate transport facilities between cities. Today all of our major tourism centres are connected by motorway and it is only a short drive from Plasencia, for instance, to other major attractions.
Our objective is to double the number of tourists coming to Extremadura in the next eight years. This is why we are working hard on a high-speed train link to shorten the journey to Madrid or Lisbon to an hour and a half, and we are also planning to build an international airport in Cáceres.
We have already completed a feasibility study for a 500-hectare location north of Cáceres, only half an hour from the planned Badajoz logistics platform. We are talking to low-cost airlines and expect to have the airport ready in 2012 for passenger as well as cargo services.