Portugal is building an AI strategy. Here's why it matters if you work here.

Good morning, Lisbon. It's Thursday, 7 May. Twenty degrees, partly cloudy. The Concertação Social meets this afternoon. Quiz Knights is tonight. And Arroios has a spot you probably haven't found yet.

🌬️ AIR QUALITY: 24 (Good).

🗞️ TOP STORY

PORTUGAL IS QUIETLY BUILDING AN AI STRATEGY. HERE'S WHY THAT MATTERS IF YOU WORK HERE.

There are movements that don't make much noise in the immediate future but say a lot about where a country is heading. Portugal's positioning in artificial intelligence is one of them.

Over the past six months, the government has approved a national data centre plan, expanded semiconductor research partnerships with European institutions, and begun actively courting AI companies to establish operations in Lisbon and Porto. The pitch is straightforward: Portugal has competitive energy costs by European standards, a young and technically educated workforce, growing fibre and cloud infrastructure, and a timezone that overlaps with both London and the US East Coast. The country's universities are producing computer science and engineering graduates at a rate that outpaces the domestic economy's ability to absorb them, which means talent is available, affordable, and increasingly choosing to stay rather than emigrate.

None of this makes Portugal an AI powerhouse. It does not have the capital of the US, the industrial base of Germany, or the research density of the UK. But it is positioning itself as the kind of mid-sized European economy where AI companies can build without the costs and congestion of the established tech hubs, and that positioning is attracting real investment. The national data centre plan alone signals that the government understands infrastructure has to come before industry.

For anyone in this newsletter's readership who works in tech, this matters practically. If you moved to Lisbon as a remote worker for a US or UK company, the question of what happens when that contract ends has always been an open one. A growing local AI and tech sector doesn't replace a San Francisco salary, but it does widen the set of options if you want to stay. If you're a founder or freelancer, the talent pool, the cost base, and the timezone are real advantages that are now being institutionally supported rather than left to chance.

The question is whether Portugal follows through. The country has a history of announcing strategic plans and underinvesting in execution. The data centre plan needs energy infrastructure that doesn't yet exist at scale. The talent pipeline needs salaries that keep graduates from leaving for Berlin or Amsterdam. The startup ecosystem needs late-stage capital that Portugal has never reliably provided. The strategy is sound. Whether it survives contact with a Portuguese state budget under pressure from storms, energy inflation, and a possible deficit in 2026 is the real test.

Bottom line: Portugal is making the right moves on AI. Whether it can afford to keep making them is the question that matters next.

⚡ QUICK HITS

The Concertação Social meets this afternoon. This is the session Labour Minister Palma Ramalho has framed as the final round on Trabalho XXI. The CGTP has already called a general strike for June 3. The UGT has not yet decided whether to join. If today collapses without agreement, the bill goes to parliament, likely passes with Chega, and faces a presidential veto from Seguro. We'll cover the outcome tomorrow.

Uber Boat is coming to Portugal in June. Uber announced at GO-GET 2026 in New York that it will launch a boat booking service in Portugal from June, in collaboration with Click&Boat, a European boat rental platform with access to 50,000 vessels. The service is also expanding to Spain, Italy, France, and Croatia. Details on pricing and routes are thin, but the concept is clear: book a boat through the Uber app the way you'd book a car. For a city built on a river that most residents never use for transport, this is genuinely interesting.

Lisbon's crime rate is falling, even if it doesn't feel that way. Minister of Home Affairs Luís Neves told a Municipal Police colloquium this week that Lisbon now has perhaps 10% of the crime it experienced during the "dark years" of the late 2000s, when roughly 900 armed robberies per year targeted banks, gas stations, and post offices. Registered crime in Lisbon fell 7.6% in 2024 alone. The perception of rising insecurity persists, driven by social media, tourism density, and visible rough sleeping, but the data tells a different story.

🍽️ SPOT OF THE DAY

ZAYTOUNA (ARROIOS)

This is not a coffee shop in the way Lisbon usually means it. There are no flat whites, no laptop-friendly corners, no barista competing for a latte art title. What there is, at a small counter inside the Mercado de Arroios, is a Palestinian grocery store that also happens to serve some of the best food in the neighbourhood, and Arabic coffee brewed with cardamom that costs €1.50 and comes with a piece of baklava.

Zaytouna was opened by Sabbat and Serenah Mesleh Hendi, two young Palestinians who moved to Lisbon and realised that the ingredients they needed to cook properly didn't exist in the city. What started as a mercearia importing products from Jordan, Lebanon, Palestine, and Syria that were previously unavailable in Portugal became, gradually, a place to eat as well. The takeaway counter now serves falafel wraps, hummus, shawarma, the Jenin pita that regulars swear by, and a kibdeh (chicken liver) dish that has quietly become one of the most talked-about things to eat in Arroios.

The setting is the Mercado de Arroios itself, recently rejuvenated and now one of the more interesting neighbourhood markets in the city. A handful of tables sit inside the market hall; a few more outside on the street. The vibe is unhurried. The owner, Hindi, knows most of the regulars by name. The shelves behind the counter are stocked with sumac, tahini, Medjoul dates, and rose water, and half the people eating at the tables are also shopping for groceries on the way out.

Arroios is one of Lisbon's most genuinely multicultural neighbourhoods and one of the least covered in the English-language food press. Zaytouna is part of the reason the neighbourhood works the way it does.

→ 4.8 stars, 488 reviews, and a falafel wrap worth the trip to Arroios ←

Rua Ângela Pinto 19, Mercado de Arroios. Tuesday to Saturday, 10am to 7pm. Closed Sunday and Monday. Around €10 to €15 for a meal, €1.50 for a cardamom coffee and baklava. Cash and cards accepted. A second location recently opened in Cascais.

Insider tip: Order the kibdeh if it's available. It's the dish the food writers come for and it tends to run out by early afternoon. The falafel is the safe order, but the Jenin pita is the one that makes you come back.

📅 WHAT'S ON

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See you tomorrow morning.