Faro cancels unused €16.42m loan and proposes nearly €14m for five projects
Faro’s municipal executive has approved the cancellation of a €16.42 million bank loan that was never used and a plan to seek nearly €14 million in new borrowing for five local projects. Four Socialist councillors backed the proposal at Monday’s meeting, while three PSD councillors abstained. The new financing is not yet final: it requires prior approval from Faro’s Municipal Assembly.
The largest proposed allocation is €5.18 million for urban renewal in Bairro Ribeirinho. The Faro–Olhão coastal cycle route would receive €3.95 million and the Pontes de Marchil roundabout €3.06 million. The plan also includes about €768,000 for Largo Francisco Sá Carneiro and just over €1.01 million to expand the Penha football ground. These are proposed financing amounts, not money already spent.
The loan being cancelled was approved in 2023 for four projects: renewal of Faro’s central axis, expansion of the Porta Nova port infrastructure, the Pontes de Marchil roundabout and a section of the Faro–Olhão cycle route. Portugal’s Court of Auditors approved the borrowing in February 2024, giving the municipality until February 2027 to draw it down. The council says none of the funds was used because the projects remained at different stages of preparation.
The reasons for delay varied. The designs for the city-centre works and the roundabout needed revisions; the port expansion could not meet conditions set out in external assessments. A public tender for the cycle route attracted no bids, and the municipality has not secured all the land needed for the route. Faro says the original loan no longer made sense while the projects were stalled and their costs and schedules were being revised.
The new package reflects updated project costs and progress on some of the schemes. If the Municipal Assembly approves it, the council can apply for medium- and long-term financing. The vote therefore does not mean the projects are all ready to start or that the funding has been secured: the borrowing and project timetable still have to pass the formal approval process.