In recent years, Portugal has developed into one of Europe’s most dynamic hubs for technology and innovation. The Portuguese ICT sector is creating jobs, exporting digital services and continuously driving forward the transformation of the economy, public administration and cities.

In doing so, the country benefits from several locational advantages: a well-educated workforce, high-performance digital networks, a growing start-up scene, integration into the European single market and a strong international focus.

The technology sector has thus long since become more than just a single economic sector. Information and communication technologies are increasingly forming the basis for new business models, modern administrative services, smart mobility and data-driven public services.

Portugal’s ICT sector is growing internationally

The Portuguese sector for information, communication and electronic technologies has developed into a significant driver of growth. Companies in the fields of software, telecommunications, electronics, cloud computing and data analysis are increasingly offering their solutions on international markets.

In 2024 alone, according to the state investment and foreign trade agency AICEP, the Portuguese ICT sector generated a turnover of around 25 billion euros. At the same time, exports of digital services have risen significantly in recent years.

Around 73 per cent of Portuguese technology companies export their services. Germany is one of the most important export markets, followed by the United Kingdom and France.

This export-oriented approach demonstrates just how closely Portugal’s digital economy is already integrated with European and international value chains.

What makes Portugal attractive to technology companies?

Portugal combines several factors that are crucial for international technology companies:

• access to the European single market

• a high level of foreign language proficiency

• a well-developed digital infrastructure

• competitive business conditions

• a growing number of skilled professionals

• close links between universities, research and industry

In recent years, numerous international companies have established development centres, shared-service locations and innovation hubs in Portugal.

Increasingly, this is no longer just about support or back-office tasks. Portuguese sites are also taking on research, software development, data analysis and strategic technology projects.

Portugal is thus evolving from a traditional nearshore location into an independent innovation partner. A nearshore location is defined as a site in a neighbouring country to which companies outsource tasks such as IT services or production.

Skilled workers as the foundation of the Portuguese tech ecosystem

A key factor in the success of the Portuguese ICT sector is its large pool of skilled workers. Around 245,000 people work in technology-related professions. Each year, some 28,000 students graduate with degrees in the traditional STEM subjects – science, technology, engineering and mathematics.

Added to this are strong English language skills and an increasingly internationally oriented higher education system. This combination makes Portugal particularly attractive to companies looking to build international development and innovation teams.

Technology hubs have not only established themselves in Lisbon. Porto, Braga, Aveiro and Coimbra also play an important role in the Portuguese innovation ecosystem.

Start-ups and unicorns are strengthening Portugal as a hub for innovation

Portugal also boasts a vibrant start-up scene. Thousands of young companies are developing solutions in areas such as FinTech, artificial intelligence, digital health, cyber security and data analysis.

Internationally renowned companies such as Feedzai, OutSystems, Remote and Sword Health demonstrate that Portuguese technology firms, or those founded in Portugal, can successfully scale up in global markets.

Digital infrastructure as a locational advantage

A high-performance digital infrastructure is the foundation for the development and scaling of new technologies. Portugal has well-developed fibre-optic and mobile networks and is continuously investing in expanding these connections.

This enables companies to develop and test digital products under real-world conditions and subsequently roll them out internationally.

New opportunities are also emerging for local authorities and public institutions to process data securely and integrate digital services.

Cybersecurity is becoming a growth market

As digitalisation advances, the importance of secure systems and infrastructure is growing. Portugal has further developed its legal, organisational and technical frameworks in the field of cybersecurity in recent years.

The protection of data, cloud platforms and critical infrastructure is essential for both businesses and public administrations. Cybersecurity is therefore not only a prerequisite for digital transformation, but also an important growth sector within the Portuguese digital economy in its own right.

How does Portugal combine technology and sustainability?

Portugal benefits from a high proportion of renewable energy in its electricity supply. This creates favourable conditions for sustainable digital infrastructure and energy-intensive technologies.

This is particularly relevant for:

• data centres

• cloud services

• AI infrastructures

• smart energy grids

• data-driven energy management

• sustainable digital business models

The combination of digitalisation and the energy transition opens up additional areas for innovation. Technology companies can develop solutions that make energy consumption more transparent, manage grids more efficiently or better integrate renewable energy.

Digital Health as a growing technology sector

Digital Health is also one of Portugal’s dynamic technology sectors. Healthcare providers, universities, research institutions and companies are developing solutions for telemedicine, health data, artificial intelligence and digital care platforms.

Portugal already has extensive digital health services. These include electronic health records, digital prescriptions and platforms for accessing health information.

This is giving rise to new areas of application for the innovation ecosystem, such as AI-supported diagnostics, telemedicine, digital patient platforms, health data analysis, preventive care services and interoperable healthcare solutions.

Digital health represents the close integration of technological innovations and public infrastructure.

Smart Cities as real-world laboratories for digital solutions

Portuguese cities are increasingly using digital technologies to manage urban processes. Sensors, data platforms and networked systems help to organise mobility, energy supply and public services more efficiently.

Applications range from intelligent traffic management, through environmental monitoring and smart lighting, to energy and water management.

Portugal is also regarded as a pioneer in interoperable electric mobility. The national charging network, Mobi.E, enables the use of different charging stations via a single system.

Cities and regions are thus becoming real-world test beds for smart mobility, clean tech and digital public services.

What challenges remain for Portugal’s ICT sector?

Despite strong growth, the Portuguese technology sector faces a number of challenges.

These include the growing demand for skilled workers, the introduction of artificial intelligence in small and medium-sized enterprises, and the transfer of research findings into marketable products.

Scaling up young companies also remains an ongoing task. Start-ups need access to capital, international markets and both public and private clients. In the long term, it will be crucial to forge even closer links between businesses, universities, research institutions, investors and public administrations.

It is precisely this interconnection that is a key strength of the Portuguese approach: digitalisation is not viewed in isolation, but is linked to economic, education, energy and regional development policies.

Portugal at the Smart Country Convention 2026

As the official partner country of the Smart Country Convention 2026, Portugal will showcase the capabilities of its ICT and innovation ecosystem in Berlin.

From 13 to 15 October 2026, SCCON will focus on topics including artificial intelligence, cyber security, smart cities, sustainable infrastructure and modern mobility solutions.

Portugal will demonstrate how technology companies, start-ups, research institutions and the public sector can work together to drive digital innovation forward.