The entrepreneurial scene in the Azores is growing, with 839 applications submitted to the incentive system since August 2023, reflecting an expected investment of € 352 million. According to Bruno Belo, regional director for Entrepreneurship and Competitiveness, support has evolved to better respond to market dynamics and the reality of each island, with a focus on small businesses, young innovation, and digitalization. The regional director informed Correio dos Açores that the confidence of local entrepreneurs is increasing, and the regional strategy is focusing on a more diversified, sustainable, and technologically prepared economy for the future.
Correio dos Açores – How is the price of the food basket currently compared to the end of 2024?
Bruno Belo (Regional Director for Entrepreneurship and Competitiveness) – We have continued to monitor prices regularly and periodically, evaluating them every month. For about a year and a half, or two years now, prices have generally remained stable.
Currently, we plan to extend this monitoring period, as a short periodicity is not justified given that prices have been stabilizing. However, we are and will continue to be vigilant, on the lookout for any changes or price fluctuations that catch our attention. If that happens, we’ll be ready to take measures in advance to prevent it.
So, it’s about letting the market work, and if the market is working well, there’s no reason to interfere. However, it’s essential to ensure that the market is being closely monitored.
There was an initial phase in which inflationary pressure was perceived and felt, especially in some basic food products, but the market quickly stabilized.
What do stable prices mean? It means that in those two years, prices have not fluctuated significantly. I can’t provide a specific figure because I am not aware of the exact prices of the products, which vary from establishment to establishment.
It’s essential to note that this price monitoring is conducted on all islands and in all municipalities. Prices differ from island to island and municipality to municipality.
What is important to us is that these prices remain stable within their universe, market, and competitive market, and do not fluctuate within those markets.
What support or incentives are available for new entrepreneurs in the region?
We took a break to reassess the incentive systems. They’ve been open since August 2023, and during that time, we’ve made the necessary corrections and improvements. Why did we do this? We wanted to refine the model based on the applications already received.
To date, 839 applications have been submitted, corresponding to a total planned investment of € 352 million. Of this amount, we have already approved around 56 million euros in incentives. We suspended the notices on March 31st to carry out a more detailed analysis, identifying which areas had the greatest demand, which had the least, and which could be adjusted to fit in better. It was necessary to stop and reassess the situation.
It doesn’t make sense for an incentive system to remain unchanged over the seven years of a Community framework, because the market changes. We need to ensure that incentives don’t become harmful. When excessive incentives are given to one sector, it can create an excess supply, which reduces profitability and ultimately leads to the destruction of companies. It is therefore essential to maintain a balance between supply and demand, avoiding over-investment in some areas and under-investment in others.
In this context, the subsystem of incentives for small businesses is already in place, and the subsystem for new investors was recently approved. The local economic base subsystem and then the structured business subsystem are next in line for approval.
Small businesses have the advantage of being better adapted to the economic reality of each island. Of the 839 applications, 610 were for small companies, indicating strong adherence to this model. This subsystem encompasses a wide range of economic activities, enabling us to avoid duplicating business areas across all the islands. Our intention has always been to allow each island to develop its economy in a complementary manner, rather than in a competitive way.
And the data proves it:
Local accommodation is most in demand on São Miguel, Pico, and Flores.
Commerce and services in São Miguel, Terceira, and Faial.
Restaurants and drinks in São Miguel, Terceira, and Santa Maria.
Each island is responding to its own market dynamics, which is a positive development that strengthens the autonomy of island economies.
Based on the high demand from small businesses, we have decided to increase the eligible investment limit from € 50,000 to € 75,000. We also changed a rule that prevented new applications for the same establishment from being submitted within two years after the previous one was completed. Now, a new application can be submitted as soon as the last investment has been completed, allowing for greater continuity in investments.
Another important improvement concerns the incentive model. Previously, there was a refundable component, a non-refundable component, and a part in prizes, which was only awarded in the so-called “cruise year”, i.e., a long time after the project had been completed. This created two problems:
A burden on the regional budget, which had to pay premiums even after the program ended.
A delay in companies receiving the funds.
Now, the premiums will be paid at the end of the investment, allowing companies to receive funds in advance and relieving the regional budget. Furthermore, as the premiums are already integrated into the current systems’ increases, this new model is more efficient and advantageous for promoters.
We are also continuing to focus on urban regeneration, particularly in commercial spaces—a priority that remains active.
So far, around 45% of the applications have been analyzed, and we are making payments. There are investments on all the islands, which is especially important to us because it demonstrates that the system is working comprehensively and in a balanced manner.
What are the main challenges currently facing entrepreneurs in the region?
One of my primary concerns when I took over the Regional Directorate was to establish a new culture of relationships between the public administration and entrepreneurs. I believe we are succeeding in creating a genuine partnership, especially given the fundamental role of consultants, who often serve as the front line in contact with entrepreneurs.
Proximity to companies and business associations is essential today. In addition to the direct contacts we maintain regularly, we are hosting a series of webinars that cover both general topics and more specific areas. For example, on the 18th, we will be hosting a webinar dedicated to the changes in the small business subsystem, providing an opportunity for both entrepreneurs and consultants to clarify their questions.
This type of initiative has two clear objectives: on the one hand, to bring entrepreneurs and consultants even closer to the Regional Directorate; on the other, to standardize the level of information and knowledge among all those involved in the process.
Currently, the beneficiaries are facing several challenges. In my opinion, the market is somewhat unstable, influenced by various factors outside the region. We are a small economy, but we are not immune to the events unfolding outside the Azores. At the same time, although we currently have the largest employed working population in the Azores, there is still a labor shortage in various sectors, including construction, restaurants, hotels, and services, which represents a constant challenge for companies.
In this sense, our system of incentives for the digital transition has proved to be an important tool. The take-up by companies has been excellent; we’re going to utilize the funds and exceed the target. Companies have seized this opportunity to improve their processes and performance. Digitalization, in addition to increasing competitiveness, also helps to mitigate the shortage of human resources by streamlining tasks and making operations more efficient.
Despite the challenges, I am pleased to see that entrepreneurs have confidence. I believe that traders have confidence in the Azorean economy and are willing to invest. The numbers of applications submitted prove this and gives me confidence in the path we are following.
There is one aspect that I consider fundamental: we have investment in all the islands and in all the municipalities. This geographical distribution of investment is crucial. The incentive system was also designed with an implicit, yet strategic, concern for people settling in the territories. Without investment, there is no creation of opportunities, and without opportunities, people tend to leave their communities.
Therefore, this logic of bringing investment to all the municipalities in the Azores is also a way of promoting territorial cohesion, balanced development, and economic and social sustainability on all the islands.
Which sectors of the regional economy have shown the greatest dynamism in terms of new business creation?
Tourism is clearly one of the most dynamic sectors. And when I say tourism, I don’t just mean accommodation, such as hotels, country houses, or local accommodation, but also restaurants and the various services associated with tourism.
We have seen the emergence of applications in the area of tourist entertainment that are particularly interesting: innovative, diversified projects, with a strong focus on sustainability and anchored in local identities and the specificities of each island. For us, this is fundamental. Accommodation, restaurants, and selling services are indeed all essential. It’s also important to recognize that tourism can stimulate other sectors of activity, including agriculture, fisheries, and environmental conservation, all of which are grounded in the concept of sustainability.
How is Artificial Intelligence being integrated into the region’s innovation and competitiveness strategies, and what opportunities can it create for entrepreneurs?
I believe that artificial intelligence clearly represents a fourth industrial revolution. And, like previous revolutions, I don’t think it will cause mass unemployment. On the contrary, as in the past, what we will see is the transformation of the job market: new professions will emerge, more specialized, more differentiated, and, most likely, also better paid.
It’s natural to be apprehensive about these changes, but I see artificial intelligence as a tool of opportunity, not a threat. We are already integrating it, for example, into our internal application processing, to make our processes more efficient. And I believe that companies will also adopt these technologies to optimize their businesses, improve productivity, perfect processes, and increase profitability.
Each company will make this journey in its own way, assessing the balance between the necessary investment and the expected return. The important thing to realize is that artificial intelligence is not an endpoint – it’s a starting point. We’re still at a very early stage, but its potential is immense.
For an outermost region like the Azores, these technologies could be decisive for our economic development by enabling us to overcome distances, increase efficiency, and compete with other areas on a larger scale.
What role do you see young people playing in the region’s entrepreneurial ecosystem? What impact have they had, and what opportunities currently exist for those starting out?
Young people can bring differentiation and innovation to any economy, and the regional economy is no different. They are more qualified, have different visions, and enjoy innovation. It’s in a young person’s nature to be innovative and disruptive. It’s clear that in various business areas, such as tourism and industry, young people bring innovation.
It’s clear that within the incentive system, with these codes of economic activity having a framework, companies will obviously develop and evolve, innovating and creating new opportunities when they apply for support. I think the Azorean economy is full of opportunities. Traditional sectors are traditional, but they can also have an innovative economy, ranging from agriculture to tourism to fishing.
We are witnessing a process of constant innovation, driven by technology and a group of young Azorean graduates who are effectively applying their knowledge and talent in the service of the economy. This is also very important to us, and we strive to maximize its potential in the young investor subsystem, focusing on specific business areas.
What message would you like to leave consumers and entrepreneurs to strengthen entrepreneurship and competitiveness in the region?
I believe that the Azoreans are invested in the regional economy, and the figures support this. This confidence is essential, and I sincerely hope that it continues to grow. Indeed, our economy isn’t on the scale of a country, but it has something that sets it apart: it’s unique, differentiating, and full of potential. And, most importantly, we have the capacity for much more.
The region has been experiencing steady economic growth for over 40 months. We can and must continue along this path. However, to do so, we must believe that we are capable, that we possess talent, and that we have vision. Our young people, above all, have to look at what appears to be a problem and know how to turn it into an opportunity. Many already do this, and it is precisely this attitude that gives them a competitive edge.
In the Azores, we are used to overcoming difficulties. Our geography and territorial dispersion bring added challenges, but they have also shaped our ability to adapt and innovate. We know how to turn situations around creatively and intelligently.
There are still many areas where young people can invest, including technologies, tourism, innovative industries, and, above all, sustainability. This last field, in particular, represents a wide range of opportunities for those who want to invest with a vision of the future.
The most important thing is this: to make the right investment, of the right size, in the right place. And with that, continue to build a stronger, more innovative, and more sustainable Azorean economy.


Filipe Torres is a journalist for the Correio dos Açores newspaper, under the direction of Natalino Viveiros.