Portugal Election Results Will Effect Golden Visa

The final results revealed that the AD coalition secured victory with 32% of the vote, followed by the Socialist Party at 23%. The far-right Chega party ranked third with 22.56%. The ruling center-right coalition, Democratic Alliance (AD/PSD-CDS), maintained its position as the dominant political force in Portugal, garnering 32% of the votes in the Sunday general election.

With 99% of the votes counted, the far-right Chega party, which received 22.56%, nearly became the second-strongest party in the country, closely trailing the Socialist Party (PS) with 23.38% of the vote. Both parties will have an equal number of seats in the new parliament, totaling 58.

Lacking a majority of seats, the Democratic Alliance, led by the Social Democratic Party, may attempt to gain support from smaller parties, though this is currently seen as unlikely, or govern as a minority, as it did in its previous term. This leaves it vulnerable to opposition parties uniting to topple it, as occurred two months ago.

The election on Sunday was prompted by the Portuguese parliament's vote of confidence, leading to the resignation of the PSD/CDS-PP minority government a year and a day after the AD/PSD-CDS coalition's victory in the early legislative elections of March 2024.

The vote followed two motions of censure, which Prime Minister Luís Montenegro survived, initiated by Chega and the PCP amid controversy involving Montenegro and the family company Spinumviva.

The case raised questions about adherence to the regime of incompatibilities and impediments for public and political officeholders.

The election exacerbates political uncertainty as Portugal considers investing over €22 billion of EU development funds. Voter dissatisfaction with returning to the polls could benefit the far-right Chega, which has capitalized on frustration with the two mainstream parties. Portugal has been swept up in the rising European wave of populism, with Chega climbing to third place in last year’s election.

The government, led by the Social Democrats in alliance with a smaller party, collapsed amid controversy over potential conflicts of interest in Montenegro’s family law firm. Montenegro, who is seeking re-election, has denied any misconduct.

He stated he transferred control of the firm to his wife and children when he became the PSD leader in 2022 and has not been involved in its management. The Socialists called for a parliamentary inquiry into Montenegro’s actions.

The Social Democrats are banking on economic growth estimated at 1.9% last year, compared to the EU’s 0.8% average, and a jobless rate of 6.4%, roughly the EU average, to maintain their support.

The impact on the Portuguese Golden Visa remains uncertain. The AD coalition has already pledged to tighten naturalization requirements for citizenship, likely requiring a longer presence for citizenship (currently one week per year) and/or a longer period before qualifying for a passport (currently five years).

What is clear is that anyone considering the Portuguese Golden Visa should begin the process sooner rather than later to take advantage of the current favorable rules.