Portugal and Brexit: old alliance, new government

Commentary

Portugal is one of the UK’s oldest allies, but changing domestic politics and contrasting views on the European project make unqualified reform support unlikely

In September, the newly re-elected David Cameron came to Lisbon a few weeks after his summer holiday in the sunny Algarve, but half a decade since his last official visit to the country. Lisbon already had had the pleasure of receiving foreign secretary Philip Hammond in February. The two visits weren’t motivated by nostalgia for Britain’s oldest ally, but were part of the UK government’s ongoing effort to persuade fellow EU members to support a package of (still vague) proposals to reform the EU. The visitors wanted to know if Britain could count on Portugal’s traditional support.

At the end of the meeting, Portugal’s prime minister announced the government’s openness to discuss the proposals that Britain is preparing within the so-called “renegotiation package”, but did not affirm that it will support them. Such a statement would be impossible and absurd. The simple fact is that the two countries find themselves in different positions within the EU. While Portugal is a member of the Eurozone and of the Schengen area, Britain is not. While Portugal sees its participation in the EU as central to its own democratic regime, Britain does not. While Portugal closely associates the country’s economic modernisation and prosperity to the single market, Britain believes there are alternatives. While for Portugal the European integration process never fundamentally questioned “national identity”, for Britain it did and still does. Consequently, Portugal’s support of Britain’s proposals will be à la carte, that is, it will depend on the nature of each proposal.

To illustrate, Lisbon is very much in favor of a stronger push to complete the single market in areas such as services, digital technology and energy. It also views positively London’s demand for a substantive reduction in Brussels’ excessive red-tape and hyper-regulatory tendency. Also, like Great Britain, Portugal (so far) has been a strong supporter of TTIP and of more ambitious trade agreements with other dynamic economies all around the world (Japan, India, Canada). However, in other areas, the Portuguese position is much more cautious. For instance, Lisbon is willing to discuss the possibility of giving national parliaments greater powers, but its support will depend on the exact details of the proposal to be presented by Britain. As a political principle devolution is good, but as a practice it should not harm integration. The same is valid for the relations between ‘Euro-ins’ and ‘Euro-outs’. Portugal is sympathetic to the desire for a guarantee that the Eurogroup will not act against the interests of those countries outside it. But it also wants to be sure that that guarantee would not harm deeper integration within the Eurozone area.

Back in September, Prime Minister Pedro Passos Coelho summed up Portugal’s position by saying that he shared Britain's desire to modernise the EU and make it more competitive at the international level, but he wasn’t willing to budge on EU core values and principles, mostly free movement of people. This means, for example, that any proposals related to transitional controls for immigration from new member states or to the possibility of deporting EU migrants, will be a clear no-no for Lisbon. And the reasons are obvious: not only Portugal is more on the EU’s integrationist side, but the fifth biggest foreign working community in Britain is currently Portuguese (in 2014, one in every four Portuguese nationals leaving the country was en-route to Britain). These reasons also explain a certain coolness when London talks about limiting social benefits for new immigrants. Despite recognising that this is a domestic matter, Lisbon believes that it brings in possible charges of discrimination against other EU nationals, i.e., to EU core values.

But on a more strategic perspective, the possibility of Britain leaving the EU is for Portugal really bad news. Close relations between the two countriesare older than the Magna Carta.From a very early age, Portuguese children learn at school that in the 12th century many of the crusaders who helped the country gain independence from Castile and Leon were English. The alliance between the two countries was formalised in 1386 in the Treaty of Windsor and reaffirmed in 1661. The alliance is still valid today and is commonly considered the oldest in the world. Throughout the 19th and 20th centuries, Portugal has always been on England side. Not only did the two countries find themselves on the same side of the barricades during the Napoleonic Wars or World War I, but Portugal supported Britain with a policy of benevolent neutrality during the Boer War, World War II and the Falklands War. Finally, Portugal was invited to be a founding member of NATO mostly due to British diplomatic diligence.

Indeed, for more than eight centuries and regardless of the country’s political regime, close political and economic cooperation with Great Britain has been a central feature of Portugal’s foreign policy. Sharing a clear atlanticist priority both Portugal and Britain viewed international politics in much the same way, including, until fairly recently, in all matters European. That is why during the 1950s Portugal stood alongside Britain at the margins of all European integrationist movements and was a founding member of EFTA. Britain entered the EEC in 1973, whilst Portugal followed in 1986. Although Anglo-Portuguese geopolitical perspectives have not been dramatically altered, it was from then on that their positions in European affairs evolved in quite different directions.

New challenges seem to lie ahead. Pedro Passos Coelho has just been appointed to a second term as Portugal’s prime-minister. His center-right coalition won the 4 October general election, albeit with no absolute majority. The decision by President Cavaco Silva to appoint this minority government followed Portugal’s democracy precedent in which the leader of the party winning the most seats in parliament has always been asked to form a government. But that decision took two long weeks, enough time for opposition leader António Costa, of the Socialist Party, to negotiate a parliamentary alliance with far-left parties. He now says he is prepared to form an alternative left-majority government. Next week the newly appointed center-right government will likely face a confidence vote at the parliament.

The Socialist Party stance towards the renegotiation package and Brexit is quite similar to that of the Social Democrats (except, perhaps, for less openness regarding TTIP and cutting welfare benefits for immigrants). That was clear during the electoral campaign: the subject was not debated, the differences were not substantive. Yet, the same is not true of the other two far-left parties in the parliamentary alliance: the Communist Party and the Left Bloc. The first has always been anti-EU and advocates ditching the Euro right away. The latter is an ally of Greece’s ruling Syriza and favours restructuring Portugal’s debt and discussing the country’s future in the Euro. They’re both anti-NATO. All this was invoked by the Portuguese President to justify his appointment of the minority government. For now Portugal is condemned to months of political uncertainty, but possibly also to a deep revision of its position in European affairs, including the question of Britain’s potential exit.

 

The European Council on Foreign Relations does not take collective positions. This commentary, like all publications of the European Council on Foreign Relations, represents only the views of its authors.

Read more on: European Power, Cohesion & Governance, Britain in Europe, London office

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