In early November the Council of Ministers approved the new strategic plan for the aeronautical sector (PESA) for the period from 2010 to 2014, which contemplates public funding of 3,732 million euros to make investments already contemplated in all segments of the sector.

The Government has decided to develop a new plan to replace the 2008-2016 plan launched two years ago, with the aim of increasing the growth of the Spanish aeronautical industry in light of the current economic situation so as to provide a response to the current market and ensure that this industry "continues to be competitive".

The Government is also seeking to reinforce the supply chain of the sector and the consolidation of subcontractors in order to attract workloads and improve the competitiveness of the auxiliary industry. These actions are aimed in particular at strengthening the companies which make up 95% of the aeronautical industry in Spain: small and medium-sized businesses which are Tier 1 subcontractors for the major manufacturers or which form part of auxiliary industry. The main source of financial support will come from the purchasing programme of the Ministry of Defence, which is prefinanced by the Ministry of Industry. It will seek to keep up the rhythm of purchases in order to partly make up for the fall in demand, consisting of a payment of 2,490 million euros over the next five years. This will mainly be spent on the programmes for the Eurofighter, the A400M and the NH90 Helicopter. At a commercial level, this financing benefits the Spanish affiliates of EADS, Airbus and Eurocopter and also ITP.

In the State Budgets for 2010, the Ministry of Industry set aside 950.9 million euros to support technological innovation in the area of defence. A novelty of the new plan is a specific provision for the aeronautical sector within the Programme for the competitiveness of strategic sectors, with a value of 285 million euros in interestfree loans with a term of 15 years, including a grace period of five years. The industry will also have access to loans of this type under the reindustrialisation programme, the aim of which is to finance the start-up of new industrial initiatives or products. In this case, the sector can benefit from up to 152 million euros in the period contemplated. In order to support the auxiliary industry and promote its concentration so as to enhance its commercial weight, the Government will provide up to 150 million euros through the National Innovation Enterprise (Enisa) in the form of participatory loans, guarantees, contributions of capital and shares in risk capital companies. This boost for the aeronautical sector also includes specific financial backing for the Spanish affiliate of Airbus.

The Council of Ministers approved a Royal Decree on Friday which regulates the direct assignment of 278 million euros of repayable advances in the form of interest-bearing loans to be applied by the company for the development of its new A350 XWB aircraft between 2009 and 2015. The Government will also offer Airbus 112 million euros for other projects in 2013 and 2014.