October 6, 2019
Incumbent PM António Costa’s Socialist Party (PS) won the elections with 36.7% of the vote but failed to secure an absolute majority by 10 seats. PS will have to negotiate with smaller parties in order to get support for its government, as it did in the last election. The far-left Left Bloc and CDU (coalition of the Communist party and The Greens), which supported the PS government during the last term, both saw their support drop: the Left Bloc received 9.7% of the vote, and CDU only 6.5%, losing five seats. The center-right Social Democratic Party (PPD/PSD), the largest opposition party, received its worst election result since 1983 with only 27.9% of the votes, while the conservative CDS-People’s Party (CDS-PP) received 4.3%. The People-Animals-Nature Party (PAN) received 3.3% of the votes, securing four seats. For the first time, a right-wing populist party will enter the Parliament in Portugal: Chega received 1.3% of the votes, obtaining one seat. Voter turnout dropped to a record low of 54.5%.
The minority government led by PS leader António Costa, who will continue on as prime minister, was sworn in on October 26. The left-wing parties who supported the government during the previous term did not strike a new formal four-year pact with the Costa government, but instead agreed to negotiate support for the Socialist Party’s legislative proposals on a case-by-case basis. The government’s legislative program was approved by the Portuguese Parliament on October 31, 2019.
- Unicameral parliament in a semi-presidential representative democratic republic.
- 230 members directly elected for 4-year terms to parliament, called the Assembly of the Republic; members are elected from 22 multi-member constituencies (including autonomous regions of the Azores and Madeira).
- Proportional voting system with closed party lists, i.e. electors may only vote for one list; no required voting threshold to enter parliament.
- The Prime Minister is appointed by the President, who also appoints members of government based of the proposal of the PM; the government is accountable to the parliament and parliament votes its confidence in the government. The parliament and the government both have legislative power.
- Incumbent: Socialist Party (PS) minority government led by PM António Costa (PS) since 2015, supported by the Left Bloc (BE) and the Communist Party - Green Coalition (PCP-PEV) with a confidence-and-supply agreement. After the parliamentary elections in 2015, PS and leftist parties managed to vote out the Social Democratic Party-Social Democratic Center (PSD/CDS) coalition government after only 11 days (making it the shortest administration in Portugal’s history).
- Socialist Party (PS) : social-democratic, progressive, center-left party; campaigns for economic and fiscal responsibility regarding government spending, reversed austerity policies imposed by the former People's Democratic Party/Social Democratic Party (PPD/PSD) government; pro-Europe; pro-NATO, committed to increasing defense spending to 2% GDP.
- People's Democratic Party/Social Democratic Party (PPD/PSD) : center-right, liberal-conservative party; largest opposition party; known for introducing austerity measures during the eurozone crisis; campaigns for tax cuts; pro-Europe.
- Left Bloc (BE) : socialist, left-wing party; critical of capitalism; proposed a number of socially liberal laws, including support of same-sex marriage; critical of the EU and seeks reform but also works against the rise of populism, nationalism, and xenophobia in Europe; is perceived as a ‘new left’ party similar to Greece’s Syriza and Spain’s Podemos; supports withdrawal from NATO and opposes EU defense.
- Unitary Democratic Coalition (CDU or PCP-PEV) : alliance of the Communist Party (PCP) and The Greens (PEV); left-wing to far-left; eco-socialism; critical of the EU but opposed to nationalist and xenophobic rhetoric; supports Portugal’s withdrawal from NATO.
Social Democratic Centre-Popular Party (CDS-PP) : Christian-democratic, conservative party; ran together with the PPD/PSD in the 2015 general elections as “Portugal in Front”; pro-life; currently pro-Europe but has flirted with Euroscepticism in the past; pro-NATO.
Impact on U.S. Interests
- The United States is Portugal’s largest trading partner outside of the European Union and accounts for around 5% of Portugal’s exports; in 2018, Portuguese exports to the United States were worth $3.5 billion and imports from the U.S. almost $1.46 billion; the overall bilateral trade in both goods and services reached $8 billion.
- Portugal is a founding member of NATO, contributes troops to NATO’s Resolute Support Mission in Afghanistan, and has participated in NATO missions and operations in the Western Balkans, the Mediterranean (combating terrorism), and in the Indian Ocean (combating piracy); Portugal contributes to the Air Policing in the Baltic Region, Iceland and the Black Sea Region, as well as NATO’s Tailored Forward Presence in Romania; Portugal has also deployed military trainers to Iraq to help in the conflict with ISIL.
- The 65th Air Force Base Group of the U.S. Air Force operates from the Portuguese airfield of Lajes Field on Terceira Island in the Azores, where the airbase serves as a logistics hub for U.S Transportation Command, U.S. European Command, and NATO allies; since the Agreement on Cooperation and Defense in 1995, the U.S.-Portugal Bilateral Commission has met semi-annually to discuss aspects on bilateral trade, including defense cooperation.
- Portugal is the 10th largest economy in the Eurozone; it has a positive growth trend (+2.1% GDP in 2018) and repaid the last portion of its €78 billion IMF bailout loan in the end of 2018, six years before the original repayment schedule. It is considered a success story, having emerged from the eurozone crisis with a positive record.
Portugal is a member of the International Contact Group on Venezuela and has recognized Juan Guaido as the legitimate interim president of Venezuela.
Key Issues to Watch
- After the European debt crisis of 2011, Portugal had to negotiate a €78 billion bailout package with the European Union; the 2011-2015 PSD/CDS coalition government adopted comprehensive austerity measures and managed to lower the budget deficit from 11.2% to 4.5%. After the last parliamentary elections in 2015, the socialist PS government reversed the austerity measures and succeeded in giving Portugal an economic turnaround, halving the unemployment level and decreasing the budget deficit to only 0.5% of GDP in 2019. However, Portugal is still one of the EU countries with the highest debt-to-GDP ratio (121.5% of GDP in 2018), though it has been on a downward trajectory and is projected to decrease to around 100% of GDP by 2024.
- The center-left PS, led by current PM Antonio Costa, has been leading in the polls and is expected to remain in power, despite a last-minute dip in the polls related to a weapons theft scandal for which the former Defense Minister will undergo trial soon. It is unclear whether PS will gain an absolute majority, or if it will again need a confidence-and-supply or coalition partner, likely with the Unitary Democratic Coalition (CDU).
- Despite the deep economic recession a decade ago, Portugal’s history with authoritarian rule has greatly diminished the rise of populist right-wing parties in Portugal. The two right-wing parties, the older National Renovator Party and the newer Chega, are both polling below 1%.
- Unlike in other European countries, immigration has not been an electoral issue as the country is used to people moving from the country’s former colonies; instead, there is an understanding that Portugal needs more newcomers to address issues related to an aging population. Portugal is also one of the European Union member states with the highest support of EU membership.
Economic issues and public spending are the key issues in the elections. PS is advocating for fiscal consolidation while opponents are criticizing the PS government for neglecting the need of investment in public services such as healthcare and infrastructure. PS and PPD/PSD have both agreed to make climate change a national priority.
Data source: Politico Poll of Polls.