MECHANICAL INDUSTRIES

closed

The objectives of the proposed project are to increase the productivity and the export performance of two state-controlled companies in the mechanical and engineering industries subsector; to consolidate their financial recovery and to rationalize their operations; and to assist Portugal in developing the mechanical and engineering industries subsector. The project involves: (i) relocation and expansion of COMETNA's steel casting foundry; (ii) relocation and expansion of COMETNA's industrial valve plant, including diversification of products; (iii) expansion of SOREFAME's hydro-power equipment manufacturing facilities; and (iv) strengthening management systems in the two companies. In addition, the project includes environmental control equipment to improve working conditions in COMETNA's existing iron foundry, and a study of the mechanical and engineering industries subsector. The risks associated with the project are mainly related to demand for some products of SOREFAME from the consumer industries, mainly the power and the railway company will be assisted by the Government and possibly the Bank in implementing its investment plan. It is considered that the company would offset partial shortfalls through higher sales in other markets.