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Festival de Almada, which is held every July in the small Portuguese city of Almada and across the River Tagus in the capital, Lisbon, is one of Europe's unique theatre festivals.

Still coming to terms with the death, in December 2012, of its founder, the great theatre director Joaquim Benite, it continues to plough a very independent furrow under the leadership of Benite's successor, and long-time assistant director, Rodrigo Francisco.

The festival was created as, and remains, an event primarily for the people of Almada, Lisbon and the surrounding areas. Although it programmes work from around the world, its priority is to offer as many shows as possible to its Portuguese audience, rather than to expend too many precious resources on its small group of international guests; for instance, in contrast with many European festivals, performances are not accompanied by English subtitles.

One need not speak Portuguese, however, to enjoy arguably the highlight of the first week of this year's festival, Al Pantalone, a new play by comic writer Mario Botequilha for leading Portuguese company Teatro Meridional. The piece applies, with great assiduousness, the physical and vocal performance styles, and the costume design, of the 16th-century Italian commedia dell'arte to the current economic crisis in Portugal.

The drama offers a depressingly familiar tale of graft on the part of the archetypal greedy banker, Pantalone, who advances himself by means of corrupt relations with friends in high places. As his scam begins to unravel, it is the "little people" who pay the price.

For the people of Portugal, who have suffered financial depredations, director Miguel Seabra's production is extremely close to home. Yet, still, the audience laughs, not at their own misfortunes, but at this searing satire of their supposed "betters".

Playing the work in the style of commedia dell'arte (a form which has inspired great satirists, from Carlo Goldoni to Dario Fo) is a masterstroke. The superb cast, led by the excellent Rui M Silva in the title role, create a brilliant collision of the 16th and 21st centuries on a set which looks like a bomb-blasted aristocratic sitting room.

It is, perhaps, too particularly Portuguese to transfer to Scotland, but this beautifully executed work of comic theatre would certainly hold its own in the Edinburgh International Festival programme.

Almada, like every festival has its disappointments. In particular, one is alarmed by director Francisco's seeming fascination with the work of Croatian theatre director Ivica Buljan who directed for the festival both Bernard-Marie Koltès's West Pier (performed in Portuguese by Francisco's own Companhia de Teatro de Almada) and Heiner Müller's Macbeth After Shakespeare (played in Slovene by Mini Teater of Ljubljana). Both productions are characterised by a type of reductive brutalism which vulgarises Antonin Artaud's Theatre of Cruelty. One is bored, rather than shocked, as the actors scream unceasingly, and as simulations of violence and degraded sex trample upon any sense of poetry or metaphor.

I fear for Festival de Almada, and for Portuguese theatre, if this style of Balkan drama is to be their latest artistic import.

The film Joaquim Benite's Last Theatre Production - It's not enough to say "No", by Catarina Neves, which is about the founder of Festival de Almada, will be screened at the Summerhall venue in Edinburgh on August 11. Mark Brown will chair a post-screening discussion with the documentary maker.

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