€7.4 Million for the Island Industry: Kick-start or a Drop in the Ocean?

Short-term uplift with a long-term question: Is the money enough?

In the morning, before the rumble of buses on the Avinguda de Joan Miró and the scent of freshly brewed café con leche, two plant managers argued loudly in front of the Polígon de Son Castelló about the new funding notices. The Balearic Islands are investing €7.4 million in 221 companies — it sounds good, even tangible, especially when the old saw in the workshop rattles and the oven consumes more electricity than necessary. But the real question remains: are these funds enough to solve the structural problems of the island industry, or are they mostly a short-term drop in the ocean?

Who receives the money — and what will it be used for?

The grant amount will be distributed among 221 companies, focusing on the wood and furniture sector, metal-processing firms and food production. In Manacor, Inca and Palma this means concrete investments: new machines, digitized processes, more energy-efficient ovens and improved cold chains. An olive oil cooperative from Sóller plans to replace bottling equipment so oil quality remains stable even in hot summers. The Balearic government expects around 113 additional jobs — a foot in the door, but not a revolution.

What entrepreneurs really need

On the Carrer de la Indústria a carpenter dryly said: “Replacing the 20-year-old saw is not a glamorous investment. For us it is survival.” Such statements hit the core: many small craft businesses do not need marketing, they need tangible modernization. New IT systems, training for digital controls and maintenance plans for machines can significantly increase productivity. But this is often where things fail: grant notices cover investments, but not always the accompanying training or operating costs during the transition phase.

The less-discussed problems

Public discussions praise the sum, but seldom question the distribution logic: How do smaller businesses in remote municipalities without extensive bureaucratic know-how access the funds? Why does a disproportionate share flow to already larger companies on Son Castelló, while workshops in rural zones receive hardly any support? Questions about supply chains, material prices and skilled labour shortages also remain — problems that cannot be healed with a one-off investment.

Concrete opportunities — if the funds are used wisely

The grants could achieve more if coupled with clear accompanying measures: targeted training for employees, on-site advisory services for energy savings, and a “small investment” category with simplified application procedures for businesses below a certain size. Another idea would be a regional pool for maintenance and spare parts, organized by local chambers of craft — increasing the lifespan of the new machines significantly.

Politics and administration: simplify instead of complicate

Bureaucracy is often the biggest enemy here. Small businesses rarely have staff to draft applications, check deadlines or obtain technical reports. The administration could therefore set up mobile advisory centres in Palma City Council municipal buildings or strengthen partnerships with local associations. More citizen participation in prioritization would also help ensure subsidies are awarded not just by size criteria but by actual need.

A realistic outlook for the island

When the funds are paid out in the coming weeks, wood dust and metal sparks in the halls will not disappear overnight. But: properly directed, these €7.4 million can act as a catalyst. They can replace outdated equipment, secure initial jobs and make small cooperatives more resilient to heat waves. It will improve more when training offers, simpler application routes and regional networks are strengthened at the same time. Then many small investments add up to a noticeable modernization.

In the evening the metalworkers switch off their machines, the streetlights on the Avinguda de Joan Miró cast long shadows into the Polígon, and a cautious feeling of new beginnings remains. The challenge is clear: grant money is not a panacea — but with smart accompaniment it can be more than a drop; it can be the first pour for a larger foundation.

Info: The programs will be paid out in the coming weeks. Companies can request more details on the investment program and should ask locally about advisory services and training measures before making investments.