Edge of the Atlantic: Portugal’s presidency of the EU Council

Last September, the US ambassador in Lisbon gave an interview to the country’s largest weekly newspaper that caused quite a stir. Referring to a public auction to allocate 5G licences in Portugal, he sent a clear message: the time had come for the Portuguese government to choose between its security allies and its economic partners. This elicited a heated reaction from all quarters, including the Chinese minister of foreign affairs – who, in a note to Portuguese news agency Lusa, declared that this was a blatant act of harassment.

Somewhat perplexed at having been caught in the crossfire, Portugal’s government stated laconically that it is up to the Portuguese to choose their own destiny. However, if there is one thing that has become evident in the past year, it is that nothing in world politics is as simple as it used to be. As Ivan Krastev and Mark Leonard recently argued in an ECFR policy brief, this seems to be all the more true for countries such as Portugal.

Since its founding almost nine centuries ago, Portugal has always defined itself strategically as an Atlantic country. For much of the twentieth century, Atlanticism was the axis on which Portuguese foreign policy turned. It was only with the arrival of democracy in the mid-1970s that the country decided it could be both Atlanticist – maintaining special ties with the Portuguese-speaking countries across the world – and a strong advocate of European integration.

Now, faced with a growing Sino-American rivalry and a world in which US power may be diminishing, Portugal will have to decide how to maintain its traditional Atlanticism while increasingly focusing on Europe. As shown in a recent survey commissioned by ECFR and conducted by Datapraxis and YouGov, two data points on Portuguese public opinion will be important in this. One is Portuguese respondents’ view that their country’s most important relationship is that with Germany (followed by the United States and then the United Kingdom). The other is their conviction that China will become stronger than the US in the next ten years (while the European Union will not).

The consolidation of the European dimension of Portugal’s politics is not new, but it seems to have accelerated with Brexit and the many crises the EU has faced in the past decade. Most Portuguese respondents say that the European political system works well (64.6 per cent) – and better than the national one, in any case. This seems to be largely due to German Chancellor Angela Merkel’s gradual acknowledgement that solidarity between wealthy and more economically fragile member states is fundamental to the cohesive functioning of the EU. Berlin confirmed its change of position by showing empathy in its support for the EU recovery fund and by authorising the European Commission to borrow in capital markets on behalf of the bloc. Portugal is all for Europe becoming more integrated and resilient, and knows that will not happen without Germany.

The two countries have strengthened their economic ties in recent years: before the pandemic, Germany was the largest foreign investor in Portugal, focusing on the technological and industrial sectors. Volkswagen Autoeuropa, the major German direct investment and main car factory in Portugal, was the largest Portuguese exporter in 2019 and 2020. Additionally, Germany’s and Portugal’s back-to-back presidencies of the EU Council prompted them to work (together with Slovenia) on a common agenda for simultaneously responding to the economic and social challenges of the pandemic, the digital transition, and climate change. Therefore, Germany and Portugal are experiencing a good moment of synergy. Only time will tell if this can continue after Merkel leaves office.

As this author argued in a recent ECFR policy brief co-written with Susi Dennison, the Portuguese view of China is characterised by a mixture of pragmatism and caution. Portugal’s relationship with this global power is marked by great asymmetry and evident economic interdependence (to Portugal’s detriment), as well as by an apparent search for political and diplomatic stability. Seventy-two per cent of Portuguese respondents say that China is rapidly becoming the second global superpower, and will overtake the US within a decade. To deny this, they believe, would be to deny reality. And yet, as ECFR’s opinion survey reveals, only 32.2 per cent of Portuguese respondents say that their country’s relationship with China is a priority. Most Portuguese citizens recognise that China will be the next major global power, but they cannot trust Beijing.

Nonetheless, the same study finds that 67 per cent of Portuguese respondents would like to remain neutral in a conflict between the US and China. By comparison, only 18.9 per cent would choose to side with their transatlantic ally. This preference for neutrality may have several explanations: the Portuguese do not want Europe to become a battlefield for two great powers once again; do not like conflict as a means of resolving international disputes; and believe that neutrality is always the best option. In any case – and despite that fact that only 6.7 per cent would choose to side with China – it is significant that Portuguese citizens of all ages would shy away from supporting their main strategic ally.

In the past four years, relations between Portugal and the US have been quite smooth – at least on a bilateral level, and leaving aside differences of style. But former president Donald Trump’s preference for unilateralism was always incompatible with the instinctive multilateralism of the Portuguese – who, as a consequence, continued to drift closer to Brussels and Berlin. No wonder, then, that 71 per cent of Portuguese respondents – like most other Europeans – seem to be convinced that the EU should not continue to rely on the US forever, and should instead reinforce its strategic autonomy.

It is still too early to tell whether this is merely a knee-jerk reaction to Trumpism or a sign that Portugal is definitively moving away from its Atlanticist position. But one thing is certain: it is not enough just to want more autonomy; one needs to achieve it. While Portuguese diplomacy keeps trying to navigate between Europe and the US for now, it may not be able to do so forever.

An important factor in this will be whether the new American president can regain the trust of his European allies. The Portuguese appear to hope that he will, with 63.1 per cent expressing great expectations for the work of the new US administration, compared to an EU average of 49 per cent. (Such optimism is especially pronounced among Portuguese respondents between the ages of 50 and 69.)

This helps explain why Lisbon would like to use its presidency of the EU Council to repair the transatlantic relationship as much as possible. To begin with, US President Joe Biden shares with Portugal a long-term commitment to multilateralism. And several of the new US administration’s priorities align with those of the Portuguese presidency (including tackling climate change and developing a closer relationship with India, to mention two of the most obvious ones). The icing on the cake would be for Biden’s first trip to Europe to coincide with the Portuguese presidency and involve a visit to Lisbon. But, then again, the issue of China will remain at the centre of geopolitics. And perhaps the US ambassador’s remarks last September were more than just rhetoric.