Portugal: Prime Minister resigns over suspected corruption

Portugal’s Prime Minister António Costa has resigned following corruption allegations. Costa said on Tuesday that he had offered his resignation to President Marcelo Rebelo de Sousa because of doubts about his “integrity”. The conservative head of state accepted the socialist head of government’s request to resign. Corruption investigators had previously searched two ministries and Costa’s official residence. The investigation involves, among other things, suspicions of corruption in lithium and hydrogen projects.

In addition to Costa’s official residence and the ministries of environment and infrastructure, several apartments and law offices were also searched on Tuesday morning. The Portuguese justice system issued arrest warrants against Costa’s chief of staff, the mayor of the city of Sines, south of the capital Lisbon, and two company representatives. Formal investigations have been initiated against Infrastructure Minister João Galamba and the head of the environmental agency APA.

The investigation revolves around suspicions of embezzlement, corruption and bribery, as the Portuguese public prosecutor’s office said. The investigators are therefore interested in issuing licenses for a lithium mine in northern Portugal, a project for the production of so-called green hydrogen and the construction of a data center in Sines.

Portugal: largest lithium deposit in Europe

Green hydrogen is produced using electricity from renewable energies. Lithium is used to produce batteries and is therefore essential for the energy transition. In May and September, the environmental authority APA gave the green light, subject to conditions, to two lithium mining projects in the north of Portugal. Environmentalists and local residents reject the huge mining projects. Lithium mining is considered extremely dangerous to the environment.

Portugal probably has the largest lithium deposits in Europe and is already the largest European lithium producer. So far, however, the entire production has been used for ceramics and glass production. Now the government in Lisbon wants to benefit from the energy transition. At a meeting with Costa in April, Chancellor Olaf Scholz (SPD) described Portugal as a “pioneer” and referred, among other things, to the planned construction of a hydrogen pipeline.

Costa lost popularity because of “Tapgate”.

When questioning suspects, Costa’s name was also mentioned to the corruption investigators, the public prosecutor’s office said. Costa is therefore suspected of having personally intervened in the processes in order to speed up the issuance of the licenses. According to the public prosecutor’s office, the suspicion against Costa will be the subject of a separate investigation.

At a press conference, Costa said he was “surprised” that the investigation had been initiated. However, the office of head of government is not compatible with the allegations made against him, he said. That’s why he submitted his resignation.

President Rebelo de Sousa convened representatives of the parties represented in parliament for discussions on Wednesday and the Council of State on Thursday. The Portuguese constitution requires meetings with the parties and the advisory body before the president can dissolve parliament and call early elections. Rebelo de Sousa will address the nation “immediately” after the State Council meeting, the presidential office announced.

Costa had been in office since late 2015 and was re-elected in January 2022. However, several scandals have recently significantly damaged his popularity, including at the Portuguese airline TAP. Almost a year ago it emerged that a TAP manager had received a severance payment of 500,000 euros before moving to the state air traffic control agency NAV. She later became State Secretary in the Ministry of Finance. “TAPgate” has now led to the resignation of more than a dozen ministers and state secretaries.