Portugal wasn't supposed to be on this list

Portugal shares a new list with the United States and the United Kingdom, and not a flattering one. It's Friday, 21 August. Twenty-eight degrees. Air quality: 34 (Good). Here's what you need to know.

🗞️ PORTUGAL PLACED ON A DEMOCRACY WATCHLIST FOR THE FIRST TIME

The 2026 Democracy Report from V-Dem, the Varieties of Democracy project at the University of Gothenburg, ranks Portugal 26th out of 179 countries on its Liberal Democracy Index. That puts it firmly among the world's leading democracies. But the same report has, for the first time, placed Portugal on its watchlist for possible autocratisation, the term researchers use for a country that may be in the early stages of democratic backsliding. The others on the watchlist are Bulgaria, Cyprus and Vanuatu.

The wider picture is stark. V-Dem's data shows that global democracy has fallen back to 1978 levels. 74% of the world's population now lives under autocracy. Only 7%, around 600 million people, live in what the index classifies as a liberal democracy. The report identifies 44 countries as actively autocratising, up from 42 last year. Seven EU member states, the United Kingdom and the United States are among them.

The US case is the most dramatic. It fell from 20th to 51st place on the Liberal Democracy Index in a single year, a drop comparable only to countries that experienced military coups. The report describes it as an unprecedented concentration of power in the presidency, with legislative constraints at their lowest level in over a century. The UK is also flagged as a new autocratiser. Denmark, Sweden and Norway hold the top three spots.

For Portugal specifically, V-Dem's statistical models estimate the country has covered roughly three-quarters of the path toward being formally classified as autocratising. That does not mean it is there. It means the direction, if it continues, would get it there. The report includes a dedicated section on Portugal, written by researchers Tiago Fernandes of ISCTE, a Lisbon university, and Sara Pina of Universidade Lusófona, which traces the shift to the rapid rise of the hard-right Chega, from one seat in parliament in 2019 to 60 in the May 2025 elections. They note that Chega's support has expanded well beyond its original base, gaining ground with middle-class voters, women, and constituencies in the south that were traditionally linked to the left.

The numbers vary depending on which dimension of democracy is being measured. Portugal ranks 23rd for electoral democracy, the basics of free and competitive elections. But it drops to 33rd for checks on executive power and the rule of law, 37th for the quality of political debate, and as low as 61st and 62nd for egalitarian and participatory democracy. The researchers describe this realignment as a driver of political polarisation and point to pressure on the centre-right PSD to build a governing majority capable of amending the Constitution, citing the nationality law changes in 2026 as an example.

The report is not all warning. It notes that Portuguese democracy retains considerable institutional resilience. PSD and PS, the Socialists, together still account for more than half the electorate, both party leaders have ruled out constitutional reform as an immediate objective, and civil society, trade unions and a growing number of pro-democracy demonstrations are cited as forces that counterbalance the risks.

Bottom line: Portugal is not in crisis, but for the first time an independent, widely cited academic index is saying the direction of travel deserves watching. It is in that company with the US and the UK, which is not where anyone expected it to be.

⚡ QUICK HITS

Renting in Portugal now absorbs 82% of the average household salary. New data from property platform idealista shows the affordability ratio for renting held at 82% in the second quarter of 2026, while buying settled at 76%. Faro is the worst at 101% of household income, meaning the average family there would need to earn more than they do just to cover rent. Funchal sits at 99%, Lisbon at 80%, Porto at 69%. For buying, Funchal leads at 115%, with Lisbon at 99%. Only a handful of district capitals in the interior, including Guarda, Portalegre and Castelo Branco, have affordability ratios anywhere near the recommended limit of 33%.

Portugal has its first ever Master of Wine. Tiago Macena, a winemaker from the Dão region, was officially awarded the title on Thursday by the Institute of Masters of Wine, one of the most demanding credentials in the global wine industry. The qualification involves blind-tasting 36 wines, a gruelling theory exam, and a research paper. Macena's focused on the Encruzado grape in the Dão. He is a partner at Código Wines and consults for wineries in the Alentejo and on the island of Pico in the Azores, with a particular focus on native Portuguese grape varieties and old vineyards. There are now 427 Masters of Wine worldwide, across 31 countries. Portugal joins the list alongside Hungary, which also gained its first MW this year.

The government is preparing a crackdown on "front shops" suspected of being used for illegal housing. The Ministry of Economy and Territorial Cohesion, led by Minister Manuel Castro Almeida, has confirmed it is working on measures to tackle commercial premises being used to house people overnight, from restaurants to convenience stores that function as little more than covers. In Lisbon alone, the Municipal Police have identified 36 establishments showing signs of being used for overnight stays. A wider licensing overhaul is planned for public consultation this autumn, with faster procedures for legitimate businesses and tighter controls on those operating outside their declared activity.

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🍽️ SPOT OF THE DAY

THE V ROOFTOP BAR (MARQUÊS DE POMBAL)

The V sits on the fourth floor of The Vintage Hotel on Rua Rodrigo da Fonseca, between the top of Avenida da Liberdade and Príncipe Real. It is open to anyone, not just hotel guests, and it is small enough that the atmosphere stays relaxed rather than sceney. A vertical garden runs along one side, there are deep sofas and low tables, and the unobstructed view faces the Castelo de São Jorge across Lisbon's old town.

The cocktail list leans on Portuguese spirits: white port, Madeira wine, ginja. The Tuga Negroni, a Portuguese riff on the classic with national gin, ginja and Moscatel, is the one most people mention. There are also mocktails and a short food menu of light bites. Cocktails run around €12 to €15.

It is open daily, roughly from late afternoon into the evening, though it is worth checking live hours before you go, and it does occasionally close for private events.

→ Find them here ←

Insider tip: go around sunset, not after dark. The view is the whole point, and once the light drops the obstructed sides of the terrace close in. Grab the seats facing the castle side, order something with white port, and give it an hour.

📅 WHAT'S ON

See you tomorrow morning.

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