Portugal’s startup and innovation ecosystem is expressing concern following the government’s recent announcement of stricter immigration and naturalisation rules.
According to a report by ECO, entrepreneurs, startup founders, and industry leaders fear the changes could negatively affect Portugal’s ability to attract and retain international talent. They warn that the reforms may undermine the country’s global image as a welcoming destination for skilled workers and tech investment.
Portugal’s centre-right minority government has proposed a legislative package on immigration and naturalisation, which aligns with the positions of the far-right Chega party, now the main opposition force in parliament. The decree still needs to be debated and approved in parliament but is expected to pass with Chega’s support.
Cabinet Minister António Leitão Amaro says the goal is to strengthen naturalisation criteria and ensure a stronger connection to the national community.
Under the proposal, most foreigners would need to reside in Portugal for ten years before becoming eligible for citizenship. However, citizens of Portuguese-speaking countries such as Brazil, Angola, or Mozambique would be subject to a seven-year requirement.
The proposed rules also include requirements that go beyond demonstrating knowledge of the Portuguese language, extending to familiarity with Portuguese culture, civic duties, and democratic principles.
Additionally, family reunification provisions would become stricter, with foreign residents needing to have legally lived in Portugal for at least two years before they can bring family members into the country, and those family members must be minors. Furthermore, the proposal introduces new grounds for revoking Portuguese citizenship from naturalised individuals who are convicted of serious crimes.
As ECO reports, despite government assurances that “highly skilled activities” would be exempt from the more restrictive measures, no official criteria have yet been defined. The lack of clarity has added to the uncertainty felt by many in the startup community.
Startups and investors worry that the proposed measures could disrupt the country’s growing reputation as a startup-friendly nation.
“Our ecosystem has a delicate balance, based on a promise of quality of life and a welcoming environment,” said Elisa Tarzia, co-founder of the 351 Portuguese Association of Startups, speaking to ECO. “Any change that is perceived as a ‘closing of doors’ can break this promise. And the impact is not only in the lack of labor, it is in the ‘Portugal brand’ itself.”
Mikhail Fedorinin, a Russian entrepreneur and founder of Albato, which employs 15 people in Portugal, expressed similar concerns. He believes the changes could affect even qualified professionals that the government claims it wants to attract.
Alongside worries about workforce impact, José Bouça, Portuguese-Brazilian co-founder of Tonner Talent, highlighted the potential harm caused by the new restrictions on family reunification.
“Our company attracts international talents who often travel to Portugal with their families,” he said. In his opinion, making it harder for their spouses and children to obtain legal residency “not only generates great emotional instability, but also directly affects the integration and productivity of these professionals.”
For Catarina Almeida-Garrett, co-founder of the consultancy AGPC Investments, the proposal to extend the residency requirement for citizenship already has consequences. She warns it will have a “direct impact on the attractiveness of Portugal as a destination for investment and relocation.”
Some entrepreneurs are already seeing early signs of a shift. Ukrainian Alex Shevchenko, co-founder and CEO of Aurora, was quoted as saying that “predictability and openness are crucial” for international founders deciding where to live and invest. “These new immigration measures, unfortunately, undermine that perception.”
He added that within his own network, several foreign professionals – including parents of Portuguese-born children – are actively considering leaving the country. “This is not just a brain drain, it is the loss of future taxpayers, entrepreneurs, and community members,” Shevchenko said. “If this trend continues, Portugal risks becoming less attractive to exactly the type of people it needs most.”
Portugal, a country of 10.5 million people, is currently home to at least 1.5 million legal foreign residents, according to the Agency for Integration, Migration, and Asylum (AIMA)). Brazilians form the largest group, with more than 450,000 residents. In 2023, 141,300 people were naturalised, a 20% drop from the previous year, while over 400,000 applications remained pending as of January 2024.
In recent years, Portugal has become an attractive and competitive destination for international entrepreneurs. Based on the latest Global Startup Ecosystem Index by StartupBlink, Portugal ranks 29th globally, holding steady among the world’s most attractive startup ecosystems.
However, as experts warn, the newly proposed immigration and naturalisation restrictions could impact this momentum, potentially making it more challenging to attract and retain foreign talent essential for continued innovation and investment.
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