Portugal Launches $3 Billion Package to Help Rebuild After Storm Kristin

Portugal Unveils €2.5 Billion Aid Package for Storm Recovery

Government Response to Storm Kristin

By Sergio Goncalves

LISBON, Feb 1 (Reuters) - Portugal's government approved a 2.5 billion euro ($3.0 billion) package of loans and incentives on Sunday to help people and businesses rebuild after the devastation caused by Storm Kristin, Prime Minister Luis Montenegro said.

Storm Kristin swept across central mainland Portugal early on Wednesday, with wind gusts topping 200 km/h (124 mph) and heavy rain that killed at least six people, damaged homes, factories and infrastructure, and cut power to hundreds of thousands, authorities said.

Loan Programs for Businesses

Montenegro said the public bank Banco de Fomento will launch a 1  billion euro loan programme to rebuild uninsured storm-damaged factories and a 500  million euro financing scheme to help them with their immediate cash-flow needs.

Support for Homeowners

The remaining 1 billion euros in aid includes a financing line to help people rebuild uninsured primary homes, covering up to 10,000 euros per house, as well as social security subsidies for individuals facing hardship or income loss, worth up to 537 euros monthly per person or 1,075 euros per family.

Emergency Measures and Calamity State

He said that, given the "current exceptional circumstances", all reconstruction work will be exempt from licensing and prior urban planning, environmental and administrative approvals.

"We are mobilising all our resources to manage the emergency responsibly, but also with hope...once again, we will rebuild Portugal," he said at a press conference.

Montenegro said the government also extended the "state of calamity" declared in about 60 hard-hit municipalities until February 8, amid forecasts of more heavy rain and flooding, even though winds are expected to ease compared with last week.

A state of calamity - Portugal's highest civil protection alert used for major disasters - allows authorities to mobilise emergency and armed forces, fast-track procurement and limit access to affected areas without curbing constitutional rights.

Nearly 180,000 households were still without electricity on Sunday, as grid operator REN and distributor E-Redes scrambled to restore power, the companies said.

($1 = 0.8440 euros)

(Reporting by Sergio Goncalves; Editing by Hugh Lawson)