As reported by Lusa, the association has requested a meeting with Minister of the Presidency António Leitão Amaro following the publication of the report, arguing that the planned legislative changes could undermine Portugal’s attractiveness to foreign residents, investors and highly skilled professionals.

Potential impact

This study assessed the potential impact of extending the minimum legal residence period required before foreign nationals can apply for Portuguese citizenship.

Researchers also considered the cumulative effect of other recent policy changes, including the closure of the property investment route under the Golden Visa programme, the end of the Non-Habitual Resident (NHR) tax regime and ongoing operational difficulties at the Agency for Integration, Migration and Asylum (AIMA).

According to the report, the most likely or baseline scenario points to economic losses of around €401 million in 2026, rising to €5.53 billion over five years and reaching €15.9 billion over a decade.

In a more severe scenario, where confidence in Portugal’s regulatory stability deteriorates significantly, the projected impact could climb to €655.1 million in the first year, €8.37 billion within five years and €23.54 billion over 10 years.

Researchers argue that lengthening the path to Portuguese nationality could discourage international workers, entrepreneurs, investors and families from relocating to Portugal at a time when several competing countries continue to offer favourable migration and investment policies.

Public finances

The report estimates that public finances would also be affected, with lost government revenue ranging from €76.6 million to €108.4 million in the first year, increasing to between €4.52 billion and €6.4 billion over a decade.

Social security contributions are expected to be among the areas most exposed, with projected losses ranging from €35.6 million to €60.6 million during the first year. Over 10 years, the study estimates the reduction in contributions could total between €2.88 billion and €4.89 billion if fewer qualified workers and entrepreneurs choose to settle in Portugal.

Furthermore, foreign residents’ spending accounts for the largest share of the projected economic impact, which means that lower household consumption could reduce economic activity by between €143.8 million and 199.9 million in 2026, with cumulative losses estimated between €8.96 billion and €12.45 billion over the next decade.

Reduced demand

The study also suggests that sectors including housing, hospitality, restaurants, private healthcare, education, retail, leisure and other local services would be particularly vulnerable to any decline in the number of foreign residents.

In addition, professional services are also expected to face reduced demand, as lawyers, tax advisers, notaries, estate agents and relocation companies could collectively lose between €618.8 million and €902.6 million over 10 years.

This report estimates that investment levels may also fall significantly, with a reduction of between €130.7 million and €274.1 million during the first year alone, with cumulative losses reaching between €1.81 billion and €3.79 billion by 2036.

Researchers warn that part of this investment could be redirected to countries such as Spain, Italy, Greece and the United Arab Emirates, which continue to promote residency and investment programmes aimed at attracting international capital and skilled migrants.

Regional disparities

This study also underscores regional disparities, identifying Lisbon, the Algarve and the Porto metropolitan area as the parts of Portugal likely to experience the greatest economic impact because of their higher concentration of foreign residents and international investment.

These proposed amendments form part of the Portuguese Government’s broader overhaul of immigration and nationality legislation, but remain subject to the legislative process and parliamentary approval before entering into force.

The Government has defended that the reforms are intended to strengthen the link between applicants and Portugal, improve integration and ensure greater sustainability of the country’s migration system.