After years of high emigration numbers, it looks as though Portugal is finally seeing an uptick in residents. For the first time in the country’s history, the number of foreigners residing in Portugal has exceeded 500,000. Earlier this month, Minister of Internal Administration Eduardo Cabrita announced that 580,000 foreign citizens were admitted last year, up from 490,000 at the end of 2018. “Preliminary data prompts me to say that in 2019, for the first time in our history, the barrier of half a million foreign citizens residing in Portugal has been overcome”, Cabrita said.
These numbers reflect immigrants who are entering through legal channels. Cabrita also noted that in the past year, the Foreigners and Borders Service (SEF) issued 135,000 new residence permits – an increase of 100,000 from 2015. But Portugal’s foreign population remains relatively low compared to the rest of the European Union; it’s one of ten EU countries where foreign residents make up less than 5 percent of the total inhabitants.
The largest percentage of immigrants hail from Brazil, Cape Verde, Romania, and Ukraine. Residents coming from Nepal and France grew the most between 2008 and 2018, with migrants from India, Spain, China, and Britain all nearly doubling within the same period.
Incentivising Expats and Foreigners
Portugal’s declining population is not a new phenomenon. There have been three major periods in the nation’s history where migration numbers went negative: from 1961 to 1973, when Portugal fought against independence movements in their colonies abroad; from 1982 to 1992; and then again from 2011 to 2016. This most recent set correlates to the financial crisis, when citizens – particularly those who were younger and holders of university degrees – went abroad in a bid to seek employment and better financial opportunities. It is estimated that more than 600,000 citizens emigrated from their home country during that time.
Now that Portugal’s economy has stabilised, the socialist-led government aims to combat its aging population and low birth rate. Unfortunately, and despite best attempts, officials have yet to determine how to successfully entice their own expats to return home. In July 2019, a 10 million euro programme, called Regressar, was initiated. On the initiative’s website, the government called out to prospective applicants, saying “It’s time to come back home. Your country will assist your return”, detailing the incentives and application requirements.
After three months and only 71 applicants, however, Portugal’s government was forced to rethink the programme’s requirements, consequently changing the deadline – but not the financial incentives – for return. Portuguese expats targeted by this campaign were not lured in, and instead seemed to strengthen their resolve in living abroad. Bernardo Larisch, a Portuguese musician living in London, told Reuters, “People go abroad specifically because they’re going to earn more…Come back to Portugal, to earn less, on a small financial incentive? I can’t see anyone taking that up”. And 35-year-old supply chain planner Rodrigo Oliveira, who now resides in Switzerland, also told the outlet, “I earn ten times the salary I would in Lisbon over here. Honestly, me and my Portuguese friends abroad, we laugh at programmes like this”.
Despite a lack of interest in Regressar, the government does seem to understand how to make Portuguese residency more attractive to foreigners. The Authorisation of Residence for Investment Activity, or golden visa scheme, has attracted 7,960 investors but has also driven up the price of real estate in Lisbon, making it difficult for locals to afford housing and increasing the cost of living overall. Because of this, the government has pivoted the focus of the programme, encouraging investors to capitalise on “low density regions and activities leading to job creation and regeneration of urban areas and cultural heritage”.
Income tax breaks for pensioners who live in Portugal for at least 183 days per year are also being provided, leading to potential savings of up to 30,000 euros per year. Meanwhile, workers across a number of professions can apply for a “non-habitual resident” category, where they are able to pay a low flat tax of 20 percent on their earnings.
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Portugal Analyses Migrant Processes
It is unclear if the SEF will be able to handle greater inflows of immigrants.
The government wants to overhaul this office’s structure to expedite existing processes, and make bureaucracy more efficient. The organisation made an announcement about its goals to streamline its offices, stating “Without prejudice to a determined action in combating human trafficking networks or in the prevention of terrorism, we must reconfigure the way in which public services deal with the phenomenon, adopting a more humanistic and less bureaucratic approach, in line with the with the aim of regular and orderly attraction of labour for the performance of functions in different sectors of activity…To this end, the Government will establish a very clear organic separation between the police functions and the administrative functions relating to the authorisation and documentation of immigrants”.
Portugal’s immigration issue is indicative of a larger trend across Southern Europe, but one that is often politically stifled by conservative, anti-immigration governments.
Spain is another EU country struggling with low population numbers. When its economic crisis hit, many residents left to seek a better future elsewhere. And while economic activity has improved in recent years, this upturn doesn’t necessarily correlate with the growth in population. The balance of births versus deaths in Spain stands in negative territory, and a smaller population won’t be able to pay off debt, extend pension checks, or stimulate investment, says one Penn State economist.
Because of its severity, the issue of population is now at the forefront of EU-wide politics. Croatian EU Commissioner Dubravka Suica is determined to put demographics at the heart of its agenda, but the EU budget may not allow for spending on cohesion – an initiative that promotes immigration. Portugal may instead find itself needing to lean into continued legal immigration of foreigners, rather than the return of expats.