A new economic projection circulating within institutional and financial circles in the Azores suggests that the archipelago may be entering a decade of increasingly uneven development, with São Miguel Island consolidating as the region’s dominant economic pole while several other islands face the risk of relative stagnation or decline.

According to the study — commissioned to support internal decisions regarding credit and investment strategies — São Miguel stands clearly at the top of projected growth trajectories through 2026 and beyond, expected to expand approximately 1.2 percentage points above the regional average over the coming decade.

At the center of that anticipated acceleration lies one transformative infrastructure project: the planned construction of the future central and university hospital in Ponta Delgada.

Beyond the direct economic impact of the construction itself, analysts believe the long-term presence of a major advanced medical and academic institution could fundamentally reshape the island’s economic profile. The sectors expected to benefit most immediately include construction, infrastructure, and associated services, but the projected ripple effects extend far beyond public works alone.

The study argues that the concentration of highly qualified professionals — particularly physicians, researchers, specialists, and technical personnel — could function as a powerful magnet for the generation of additional Gross Value Added (GVA), reinforcing São Miguel’s position as the archipelago’s principal economic engine.

In practical terms, the hospital is viewed not merely as a healthcare project, but as a strategic economic anchor capable of attracting talent, investment, and secondary economic activity across multiple sectors.

The analysis also identifies Pico Island as one of the islands with the strongest projected growth prospects, expected to expand approximately 0.4 percentage points above the regional average.

In Pico’s case, the forecast is linked to the continuing strength of nature tourism, the increasing international prestige of the island’s wine sector, and sustained appreciation within the real estate market. Together, these sectors continue transforming Pico into one of the most dynamic small-island economies in the archipelago.

From the perspective of the financial institution that commissioned the study, both São Miguel and Pico emerge as strategic islands for investment over the next decade.

Yet the report simultaneously paints a more uncertain picture for several other islands.

Faial Island and Terceira Island appear in what the study describes as a “red zone” of concern, with projections indicating potential declines in their relative economic weight within the regional economy.

For Faial, the projected reduction stands at approximately -0.1 percentage points below the regional trend, while Terceira faces a projected decline of -0.3 percentage points.

Specialists cited in the study warn that the concentration of advanced medical services in Ponta Delgada may gradually drain technical relevance, specialized resources, patients, and institutional centrality away from the hospitals and healthcare ecosystems currently operating on those islands.

Such shifts, if confirmed, could produce broader secondary effects on local economies already deeply interconnected with public services, healthcare employment, and administrative functions.

As a result, both islands are reportedly being monitored closely from the standpoint of future credit exposure and the viability of new investment models.

The outlook becomes even more fragile in the smaller economies of the Western Group.

Flores Island (-0.8 percentage points), Corvo Island (-1.1 percentage points), and Graciosa Island (-0.6 percentage points) are identified as the territories most vulnerable to losing economic momentum in the coming years.

The study points particularly to the heavy dependence of these islands upon public-sector employment and the growing effects of demographic desertification — a reality increasingly visible across several smaller island communities struggling with aging populations, emigration, and declining economic diversification.

Within the document, these islands are reportedly categorized as “microeconomies” expected to grow at a significantly slower pace than the dominant economic pole represented by São Miguel.

Interestingly, Santa Maria Island and São Jorge Island do not appear in the portions of the study currently accessible, and no explanation has yet been provided regarding their omission.

Beyond the numbers themselves, the study raises deeper questions about the future balance of Azorean autonomy and territorial cohesion.

For decades, the political philosophy of the autonomous region has rested upon the principle that all islands — regardless of size or geography — should participate meaningfully in development, public services, and opportunity. Yet economic gravity increasingly appears to favor concentration around larger urban and institutional centers, particularly São Miguel.

The challenge facing the Azores may therefore become not simply how to grow, but how to grow without deepening asymmetries between islands.

In archipelagos, imbalance is never merely economic. It becomes demographic, social, cultural, and emotional. When opportunities concentrate too heavily in one place, smaller islands risk losing not only investment, but also people, confidence, and future horizons.

The Atlantic geography that once forced the islands to depend upon one another now confronts them with a different question: whether modernization can occur without fragmentation.

Translated and adapted from a story in Diário Insular-José Lourenço-Director.