Portugal wants its emigrants back – so it’s paying them to return

Ibrahim and his family, resettled refugees from Sudan, recently moved into their first apartment in Madrid, Spain. After a year spent in a reception centre, the family is adjusting to living independently. © UNHCR/M.J.Vega

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: David Elliott, Chief Sub-Editor, Formative Content

Portugal boasts pristine beaches, thousands of hours of annual sunshine and cuisine that includes little custard tarts that are enjoyed far beyond its borders.

Despite these attractions, the percentage of its citizens living abroad is one of the highest in the world. And with a lack of skilled workers and an ageing, shrinking population disrupting the labour market, it’s launched a bid to tempt them to return.

The Regressar scheme offers former residents who have lived away for at least three years incentives to move back. Those who do will have their income tax bills halved for five years. And there’s cash to help with relocation for anyone taking a job.

Portugal already gives investors and job creators the right to live in the country. It offers tax breaks for skilled migrants too. But the new programme wants people back even if they’re not highly skilled or well-paid.

Hiring headache

The country has been hit hard by financial crises in the past decade, during which younger, educated people left in droves – 50,000 people a year left permanently between 2011 and 2014, according to the government.

The economy bounced back after an EU bail-out in 2011, fuelled by tourism, a growing tech industry and strong exports. But while gross domestic product has returned to pre-crisis levels and unemployment has dropped, companies are complaining of a huge shortage of qualified workers.

More than half of the country’s CEOs told a survey by recruitment consultant Stanton Chase that finding such workers was their “biggest headache”. And according to the head of the Portuguese Business Confederation, the problem persists in every sector.

The government says many of those who left the country at the start of the decade belong to one of Portugal’s most qualified generations ever, making the new scheme “a necessity”.

Further concern

Portugal is not the only European country that wants people to return. Poland has scrapped income tax for younger emigrants in an attempt to fill its own skills gap by attracting some of the 1.7 million people who have left over the past 15 years.

Emigration is worrying other nations, too, according to a recent survey of 14 EU countries by the European Council on Foreign Relations (ECFT). In Italy, Romania and Spain, citizens are more concerned about people leaving their country than coming in.

And some even think nationals should be prevented from leaving the country for long periods of time.

An essential fix

And what about immigration? An MIT study that collated polls from 27 European nations across nearly 40 years says people have become more receptive to the idea in recent decades.

However, while most don’t consider immigration and border controls their primary concern, per the ECFT survey, they are recurring issues across the continent. Majorities in every member state polled support “better protecting” Europe’s borders.

From Brexit and campaigning for the recent European elections to the rise of populism in countries including Italy and Hungary, migration continues to dominate the political agenda around the continent.

For Portugal, though, opening its doors is a priority. Prime Minister António Costa says immigration is essential to beat the country’s demographic crisis, and recently called for Europe to “mobilise against populism and xenophobia”.