Portugal bets big on industry to break free from tourism reliance
Portugal has long depended on tourism as a key economic driver. But recent years have seen a shift, with major investments aimed at reviving industrial growth. A new wave of state-backed initiatives now seeks to reduce this reliance by fostering high-value sectors like semiconductors, green energy, and advanced manufacturing.
On the podcast *45 Graus*, economists and policymakers are debating these changes. Hosted by José Maria Pimentel, the show explores how industrial policy—once dismissed—could reshape Portugal's economy for the better.
For decades, industrial policy was met with scepticism. Critics linked it to failed state interventions and trade barriers. Yet in Asia, countries like South Korea and Hong Kong proved its worth, using targeted strategies to build competitive industries. China's rapid growth further demonstrated how state planning, paired with domestic competition, could transform an economy.
In Europe, the idea has regained traction. Portugal's government has embraced it through ambitious programmes. The **Recovery and Resilience Plan (PRR)**, funded by €16.6 billion from the EU's NextGenerationEU, includes projects like a €300 million semiconductor plant in Sousa and a green hydrogen initiative in Porto Santo. Another €23 billion under **Portugal 2030** supports electric vehicle batteries, with Northvolt's factory in Sines set to open by 2023. The **More than Tourism** plan aims to diversify the economy by attracting tech events like Web Summit Lisbon and offering R&D tax breaks. Meanwhile, the **National Strategy for Industry 2030** directs €2.5 billion into biotech, renewables, and other strategic fields. Officials project these efforts will create over 50,000 industrial jobs by 2025. Ricardo Paes Mamede, a political economy professor at ISCTE, argues that the state must play a stronger role in structural change. His views feature in discussions on *45 Graus*, a podcast hosted by economist José Maria Pimentel. Released every two weeks on Wednesdays, the show brings together experts to examine Portugal's economic challenges and opportunities.
Portugal's recent policies mark a clear break from its tourism-dependent past. With billions invested in semiconductors, green energy, and advanced manufacturing, the country is betting on industrial growth to secure long-term stability. The success of these plans will determine whether state-led strategies can deliver lasting change.
