Portugal’s Economy Minister promotes tourism, tech, life sciences and low-cost talent

Portugal’s Economy Minister promotes tourism, tech, life sciences and low-cost talent

Sweden is a leading advanced economy and diplomatically, punches above its weight. Decision-makers are normally fairly easy to access, and therefore Sweden is on the diplomatic map for other countries looking to understand Nordic solutions, develop trade ties and advance political agendas. Understanding the objectives and subtleties of this process deepens Mundus coverage of Sweden, and we look forward to sharing this with you via The Mundus Blog.

The Portuguese Minister of Economy, Manuel Caldeira Cabral, is visiting Sweden from 28-29 August to promote economic relations between the two countries. His programme includes meeting Niklas Johansson, State Secretary for innovation and start-ups, the Confederation of Swedish Enterprise and companies operating in biotechnology and life sciences. Cabral is eminently qualified for his portfolio, with a PhD in Economics, time with the World Bank in Washington and career experience that includes negotiations EU financing for Portugal.

On 28 August, Mundus International met with the Minister, who spoke consistently about “the moment that we are living” in Portugal, which he explains as taking advantage of the successes that Portugal is having today. After the difficult year’s surrounding the Financial Crisis, Portugal has rebounded and GDP is now growing at over 2%. In 2017, the country won the overall “Leading Destination” at the World Travel Awards, which Minister Cabral thinks can be taken much further, with year-round experiences. Portugal also won the right to host the Web Summit for 2016-2018, the “largest tech conference in the world”, with 70,000 expected to visit this year. For Minister Cabral, getting the most out of this moment means achieving ever more. and he is very hopeful that the life sciences sector can expand exponentially, given the country’s large available talent pool of PhDs, pro-growth government incentives and low costs, e.g. for housing.

The following in an excerpt from the interview with Minister Cabral

Why are you visiting Sweden?

I have been trying to visit Sweden for a while. This trip was originally planned for May, but needed to be rescheduled. Sweden has a long history with my country, both with travel and industry. Swedish firms have been investing successfully in Portugal for decades, and I want to promote to them the latest developments in the Portuguese economy. We see a lot of interest. Politically, Sweden is interested in how Portugal responded to the Financial Crisis, turning the problems around and making new sectors, investments and exports. Some Swedes are interested in tourism, some in production in traditional areas and others in partnerships in the tech sector.

This is a great moment that we are living in Portugal. The economy is changing, but I want it to do more, and faster. So, I think there’s lots of room for growing traditional areas of cooperation, but also creating new ones. I have just come from Denmark, where Vestas, a big Danish wind energy firm, has decided to put a research centre employing 300 engineers in Portugal. I am hoping that I can find more firms interested to site their R&D there, gaining access to Portuguese talent.

Is government policy behind the reason for Portugal’s economic rebound?

What we’ve done since we came into government was to guarantee that we have the very best policies that we can put in place to promote growth. We have used structural funds to create instruments for Venture Capital (VCs) to use. What Portugal wants is VCs who can bring knowledge, so we are co-investing with this type of VC. But, our investment is asymmetric, by which I mean that if there are losses, then we share these losses. If there are profits, then we only want our money back, and the investors can benefit from the gain. So, entrepreneurs and VCs can appropriate the value that they create.

We also have a system of tax incentives for start-ups, a network of 130 incubators and we won the Web Summit.

Why should Swedish firms have a location in Portugal?

Firstly, it is because of the abundance of talent that is not so easily available in Sweden or in Germany. But it is also about costs – we are a much cheaper location, and your investor’s money is not wasted on inefficiencies such as property. Also, we are only a short flight away, and with great infrastructure when you arrive.

And, I really want to stress that Swedish firms should be thinking about Portugal at an earlier stage. Not just when you have thousands of people. When you only have €10m to spend, it will take twice the time before your money runs out.

What was behind Lisbon’s success in winning the right to host the Web Summit?

The Web Summit began in Dublin. In 2015, it attracted over 40,000 people. Portugal won the right to host it from 2016-2018. I think that this idea that we could do it started because out of a thousand firms, a Portuguese company won the start-up pitch, which surprised people, although not us, of course. People began to think that ‘something must be going on in Portugal’. And, of course, we also have great conditions for hosting events like this, as a tourist location and with infrastructure. We had 60,000 people last year, and there were no complaints at all about Internet speeds, which there had been in Dublin.

What would you say to Swedish start-ups thinking of attending the Web Summit?

Come for sure, for the summit itself. It’s the biggest global tech gathering, and an amazing opportunity to meet partners and investors. All of the biggest investors are there. You never know who you might be standing next to at the Night Summit, which is of course mainly a party, but also great networking.

But when you are there you will see that my country is a great, low cost location, with abundant talent for your start-ups and scale ups.

Take the opportunity to travel. There are so many great experiences in Portugal. Of course, everyone knows about the Algarve and beaches, but last year, Portugal won the overall “Leading Destination” at the World Travel Awards, which is because there is so much to do. There’s the history in the cities, but also wine tourism and cycling, so we see Portugal as a place to have experiences. And of course, the weather is still really nice in November, so if you can stay, you will really enjoy yourselves.

Why is Portugal developing a reputation for life sciences?

Portugal was late to begin investing in higher education. We only really began building up our universities 20-25 years ago. Most of today’s professionals had to get their PhDs outside of Portugal – mine, for instance was from the UK, but many others went to the USA.

Now when this generation came back to Portugal they were much more educated than their parents. They found a market and a structure of the economy that was not really a good fit for them. So, two things happened. Firstly, the economy has changed, meaning that our exports have changed, and we now produce machinery, automobiles and aeronautical parts. Pharmaceuticals has doubled in value. But secondly, they began a start-up movement. New companies formed in software, fintech, engineering, medical devices and biotechnology.

This happens much quicker of course in software, but the investors also began to see that there were opportunities in life sciences, with our huge stock of PhDs. There is a lot of collaboration between Swedish and Portuguese universities – I think we counted about 1000 projects. But, it has also attracted investors such as Bayer and Syngenta, also Belgian and Israeli firms. I think that there’s lots of room for business development, which uses our knowledge, but deploys foreigners experience in growing businesses.