Spain Extends Financial Incentive Program to Support Shipbuilding Industry

The government of Spain has voted to extend an existing financial support program designed to encourage the country’s shipbuilding and repair industry. The Ministry of Industry reports it is a well-received program and helped the Spanish shipbuilding industry to build an order book that is the highest it has been in more than a decade.

The government provides a subsidy program to compensate the shipyards and others in the industry for the interest rate paid on loads during the construction and repair process. According to the Ministry, the program supports the industry by providing greater certainty and stability in the planning process for projects.

The program is being extended to run through the end of 2029 with the government committing to provide a total of €559 million ($638 million) to encourage the construction and conversion of ships in the country's shipyards. The program provides up to one percent point in compensation to credit institutions to cover the difference between the interest rate applied to loans granted to shipowners, shipyards, and third parties, and the reference commercial interest rate.

According to the Ministry, the program provided €41.14 million ($47 million) in support to the industry in 2024. They believe this contributed to 2024 being an exceptional year for the Spanish shipyards. The industry registered 40 new contracts work over €1.5 billion ($1.7 billion).

“The government values the importance of the naval industry for our country and is committed to the diversification, modernization, and productivity of the Spanish naval ecosystem,” said the Ministry.

Among the companies that have benefitted from the program are two of Spain’s largest shipbuilders, PYMAR group which represents yards across northern Spain and Navantia. The Ministry reports the two yards have more than 100 initiatives underway and received grants worth €58 million ($66 million).

The Ministry highlights that Spain has a range of programs to support the development of the domestic shipbuilding industry. This includes the Fund to Support Productive Industrial Investment (FAIIP), the Active Financing program, the Naval Research, Development and Innovation Line (IDI), and aid to Innovative Business Groups (AEIs).

The industry closed 2024 with its orderbook at its highest level since 2011. The Ministry reports Spain’s private shipyards had 65 vessels under construction at the end of 2024. They report that this is generating more than 14 million working hours.