LISBON, Feb 16 (Reuters) - Portugal will use all grants from the EU recovery fund to reboot its economy after the coronavirus pandemic but will take up less in loans than initially expected due to its already high public debt, Planning Minister Nelson de Souza said on Tuesday. An updated version of the recovery plan said the nearly 14 billion euros in EU grants would be used until 2026, but lowered the loans forecast to 2.7 billion euros from the 4.3 billion euros predicted in October. “This is an opportunity that we cannot afford to lose... but the macroeconomic situation of debt in our country conditions (us) and tell us to be prudent in the use of funds in the form of loans,” de Souza told reporters. The government also outlined expectations to develop a cross-border lithium project with neighbouring Spain, which also has reserves of the light metal, to produce and recycle electric vehicle batteries. It did not provide any details except that the factories would be installed in border regions. Portugal already produces lithium for the ceramics industry, and companies are now preparing to produce higher-grade lithium used in electric cars and to power electronic appliances. The plan envisages dozens of investment projects, including in health, social housing, innovation and infrastructure. There are also projects to support a greener economic model and the digitalisation of companies. The plan is under public consultation for two weeks and will be submitted to Brussels in early March, de Souza said, adding some projects might start being implemented before this summer. Portugal’s economy shrank 7.6% last year due to the pandemic, its biggest annual slump since 1936, and the public debt ratio rose to a record high of 134.9% of gross domestic product. The government is determined to cut the debt ratio to 130.9% this year. (Reporting by Sergio Goncalves; Additional reporting by Catarina Demony; Editing by Andrei Khalip and Ed Osmond)