Portugal Unveils €10 Billion Aid Package Amid Trade Tariffs

LISBON, Portugal, April 10 — Portugal’s caretaker government unveiled a comprehensive aid package worth over 10 billion euros ($11.1 billion) on Thursday, aimed at bolstering the economy against the effects of recent U.S. trade tariffs. Prime Minister Luis Montenegro shared details of the plan during a press briefing following a cabinet meeting where the initiative was approved.

“The world we knew has changed, we have to adapt and react. There is no certainty about what awaits us, but we were not caught by surprise,” Montenegro stated, emphasizing the necessity of the measures to sustain economic stability.

Economy Minister Pedro Reis explained that the assistance would primarily benefit around 70,000 exporters and foreign investors relocating their operations to Portugal. The package includes 5.2 billion euros in financing for companies’ working capital and investments, along with specific allocations of 3.5 billion euros for export investments, 400 million euros in grants, and 1.2 billion euros in credit insurance.

This announcement follows a similar 14-billion-euro aid package revealed a week earlier, positioning Portugal as a proactive responder to tariff threats issued by U.S. President Donald Trump. Reis noted that despite the later timing, Portugal’s plan surpasses Spain’s in scale relative to its economy, receiving positive feedback from the business community.

“Companies and foreign investors see these measures as positive because the Portuguese economy is more awake… and it gives confidence,” Reis added during discussions with government officials.

Portugal has maintained budget surpluses over recent years, a contrast to many eurozone counterparts, including Spain. Reis reassured that the government would not revert to a budget deficit, even if some companies fail to repay loans from the package. “I would be much more worried about the deficit if we didn’t have a plan like this,” he commented.

The centre-right minority government, currently in caretaker status ahead of elections in May, has forecast a budget surplus of 0.3% of gross domestic product (GDP) for the current year, following a surplus of 0.7% last year.

The impact of the U.S. tariffs has caused concern among global leaders as markets react to the prospective end of trade liberalization. Trump had previously announced reciprocal duties on multiple countries, which continued to escalate tensions in the ongoing trade war with China.

Last year, the United States comprised approximately 6% of Portugal’s total exports, with key exporting sectors including energy giant Galp, pharmaceutical companies, cork producer Corticeira Amorim, and the pulp and paper manufacturing group Navigator.

The Bank of Portugal has warned that the tariff dispute could lead to a reduction of 0.9 percentage points in its 2025 growth forecast of 2.3%.