Hot on the heels of a failed IT project to link the Algarve’s councils with a fibre-optic system, the insolvent company Globalgarve is pressing ahead with another project to invest €3.3 million in digital billboards, using EU funds.
The Business Association of the Algarve (ACRAL), which also owned the publication ‘O Algarve,’ - also failed – now is run by Victor Guerreiro, as is Globalgarve – Cooperação e Desenvolvimento, SA.
Guerreiro's new project aims to sell space on a digital communication system for tourist information. "We have partnered with Media 360, a company that has been working in this area in the north, and also Algarve 360 – Global Media Solutions," said Guerreiro.
The project has been presented to the region’s council chiefs, but many have already expressed their reservations due to Globalgarve’s past record of failure, added to the fact that most of them owe Globalgarve money, adding to its financial misery when in January 2014 it sought creditor protection, owing €790,000.
BES is Globalgarve’s largest creditor which was granted an up-front €300,000 in a recovery plan just agreed, a plan which few in the Algarve's business community see as sensible or viable. The recovery plan was agreed by a small majority of the creditors, they saw little option as there is no money or assets to divvy up if the company had been wound up.
Globalgarve was founded nearly two decades ago and has spent €20 million largely from EU subsidies, despite which it still managed to fail, spending €8 million on its last ill-fated technology project.
The funding for the shiny new project will come from two applications that remarkably have been approved by the Commission for Coordination and Regional Development - Algarve on behalf of Canal Algarve - owned 100% by ACRAL which controls Globalgarve.
Globalgarve’s main shareholder is the Algarve Tourism Board, no stranger to spurious ‘investments’ in the name of progress and which sat by and watched as Globalgarve installed more than 200 kilometres of fibre-optic cable in one of the most expensive mistakes ever made in the name of regional development.
The company’s current boss, Victor Guerreiro, blames his predecessor.
Earlier, the region’s councils were shareholders in Globalgarve and also were the main customers for the fibre-optic system. They also have their websites maintained by Globalgarve but many developed a bad habit of not paying their bills, driving Globalgarve, a company of which they owned much of the share capital, into debt while remaining as shareholders.
The fibre-optic Algarve Digital programme set up by Globalgarve aimed to install wi-fi hotspots in Algarve’s main city squares. The system is inoperative. In Faro none of the four designated wi-fi hotspots are functioning, it is the same story in all the other towns in the region. A year ago due to law changes, the councils all were foreced to ditch their shares in the company, presumably this was a day of great joy.
Victor Guerreiro has been in charge for eight months and believes that Globalgarve, through outsourcing the technology part of the great new digital project, will ensure success - with the caveats that the system only is viable “provided that municipalities comply with the commitments," ie that they pay their bills.
It can not have escaped Guerreiro's notice that the region's councils are hideously in debt and also have a history of failure when it comes to paying invoices. Guerreiro's background is in the clothing trade.
See also: http://www.algarvedailynews.com/news/1405-insolvent-globalgarve-pleads-for-more-of-your-money
Comments
As previous posters have often pointed out - when will the crime of 'misuse of public funds' be enforced ??
Until then - if necessary - the company doing business with the council taking a 'precautionary interest' in some asset of the council.
All councils have a number of surplus properties and their town mansions in Lisbon or Porto etc to seize in lieu of payment. Their crown jewels.
Additionally making the municipal officials personally liable for whatever their politicians authorise them to do. A variation of the 'Win an Audi' competition Financas is running.
Think about the gang of Weasels, guys. (in Toad of Toad Hall / Wind in the Willows) !