4  BIS central bankers’ speeches  It is down to the private sector to define effective responses to the challenges of external competition, the market opportunities and the evolution of knowledge and technology. In this regard, I would like to outline two aspects that I believe are particularly relevant. Firstly, the capitalisation of Portuguese companies needs to be strengthened.
Our companies’ high leverage ratios not only reflect the fragility of Portugal’s economic fabric (as firms are particularly vulnerable to changes in financing conditions), but also reflect strategic weakness (because high indebtedness limits the ability of firms to respond to changes in the external environment, jeopardising their growth potential).