Madeira: Country and Foreign Investment
Economy and Currency
The four pillars of the Madeiran economy are farming, fishing, tourism and offshore financial services. The increased economic prosperity resulted in an unemployment rate of 6% (2008) which was extremely low by Portuguese standards, but this more than doubled to 14.3% (2011).
To cater for the labour demands that increased economic prosperity brought about, the government set up the Centro Regional de Formacao Profissional whose objective was to train young Madeirans for the skills required in the new developing market place.
Fishing and farming are the traditional industries of Madeira, with wine production having been a particular success recently. Tourism followed the advent of democracy in 1974 and was given added impetus by Portugal's accession into the European Community in 1986. 1990-3 saw an estimated USD370m of grants to Madeira resulting in a construction boom.
The official currency is the Euro. In September, 2002, Moody's assigned an Aa3 foreign currency issuer rating to the Region of Madeira based on the region's buoyant economy, its improving financial performance and manageable debt burden.
Moody's said at the time that its rating took into account the rapid pace of growth recorded by the local economy, which enabled the region to partially catch up with EU and domestic GDP per capita and achieve very low unemployment rates.
In September, 2011, Moody's downgraded the long-term issuer rating of Madeira from B1 to B3. 'Concerns over the region's poor governance and management as well as weak budget execution' where given as the main reasons for the decision. Unreported costs and debt rescheduling agreements not reported by Madeira's regional government since 2003 have had a combined impact of EUR1.1 billion in the 2008, 2009 and 2010 deficits.
GDP per head in 2009 was EUR20,761.