Portugal's Socialists pledge to raise minimum wage, boost competitiveness

LISBON (Reuters) – Pedro Nuno Santos, the leader of Portugal’s ruling Socialist Party (PS), has made a pledge to increase the minimum wage and promote economic competitiveness by offering more incentives to specific sectors if his party wins the upcoming election in March.

The current Socialist Prime Minister, Antonio Costa, has been in office since 2015 but resigned on Nov. 7 due to an investigation into alleged illegalities in the government’s handling of lithium, hydrogen, and data center projects.

As a result, President Marcelo Rebelo de Sousa has called for a snap election to take place on March 10.

While most opinion polls show the PS and the center-right Social Democratic Party at a similar level of support, analysts are concerned about the possibility of a post-election stalemate and the potential for the far-right, anti-establishment party Chega to gain influence.

During a center-left party congress, Santos emphasized the need for a more diverse and sophisticated economy in order to provide higher value, better wages, and revenue for an advanced social state.

He also addressed Portugal’s ranking in the IMD-Institute for Management Development’s competitiveness world ranking, where the country placed 39th out of 64. Santos expressed his desire for Portugal to be among the top economies, rather than just average in the European Union.

Santos plans to identify key sectors through collaboration between companies and universities, and suggests that the economy can be transformed through more selective incentives and targeted investment over the course of a decade.

However, despite these plans, the Bank of Portugal has recently lowered its 2024 economic growth forecast, signaling a slowdown in comparison to the previous year.

In addition to economic policies, Santos also promised to raise the minimum wage to at least 1,000 euros ($1,094.10) a month by 2028, an increase from the current level of 820 euros.

The 46-year-old former infrastructure minister took over as secretary-general of the PS after winning a party election in mid-December. He commended Costa for his work in balancing the public accounts but acknowledged the challenges related to healthcare, education, and housing.

($1 = 0.9140 euros)

(Reporting by Sergio Goncalves; Editing by Susan Fenton)