Despite receiving billions in EU structural funds and €13.9 billion from the Recovery and Resilience Plan (RRP), Portugal consistently ranks among the EU countries with the lowest levels of public investment relative to GDP — around 2.1% compared to the EU average of 3%.
🔹 Key issues:
Dependency on Brussels: EU funds often replace national spending rather than complement it.
- Low investment quality: Many projects lack transformative impact and reflect poor planning (e.g., the MetroBus project).
- Over-centralization: Local governments control only about 15% of subnational spending, limiting local impact.
Narrow focus: While climate, mobility, and digital projects are prioritized (in line with EU policy), sectors like justice, housing, and productive capacity remain underfunded.
🔹 The result:
Public investment is treated as episodic and externally driven, rather than as a strategic, long-term policy tool. Portugal lacks consistent planning and efficient execution, making it vulnerable when EU funds dry up.
🔹 The choice ahead:
Portugal must either continue investing only when EU money is available, or start viewing public investment as a core economic strategy, funded structurally, with a focus on efficiency, transparency, and regional diversity.
The real issue isn’t how much Portugal spends — it’s how well it spends it. Without reform, the country will keep underperforming economically and relying on external help to fund its future.
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