Portugal's government has dropped its opposition to a key regional finance law, saying it will grant a funding hike to the storm-devastated island of Madeira, local media reported Thursday.
"This subject no longer has its place in the center of the political debate. We must mobilise every effort to bring a response to this region, affected in such a difficult and brutal way," Economy Minister Jose Vieira da Silva was quoted saying late Wednesday.
The tourist island is still recovering from weekend flash floods that killed at least 39 people, left 600 others homeless, gutted buildings and overturned cars.
Vieira da Silva, who visited the island on Tuesday, said it was too early to assess the damage costs.
But his remarks on funds for Madeira marks a turnaround from the government's staunch opposition to a controversial regional finance bill passed by parliament earlier this month.
The minority Socialist government vowed to try and block the legislation to increase funding for regions, warning it will raise the budget gap at a time of heightened concern about Portugal's foundering economy.
A vote on the overall proposed budget, which aims to reduce the public deficit by a percentage point to 8.3 percent, is expected March 12.
Vieira da Silva also announced an upcoming publicity campaign launched with Madeira's regional government "to restore the image" of the island.
"The infrastructure of the hotel sector was lightly touched by the events," he said. "But we know the image could have a negative effect."
Portugal also has said it planned to appeal for European Union funds to help the island recover.
An initial 50-million-euro (68-million-dollar) credit line has been opened for Madeira shopkeepers, many of whom lost everything in the deluge.
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