Portugal’s new minority government aims to outmaneuver populist rivals

Prime Minister Luis Montenegro delivers a speech after being sworn in by Portuguese President Marcelo Rebelo de Sousa at the Ajuda palace in Lisbon

Portugal’s new center-right minority government took office yesterday [Macau time], days after its first test in parliament exposed both the pitfalls and the opportunities it faces following a radical right populist party’s sudden surge in support in a recent general election.

Only one of the 17 ministers sworn in at a ceremony in Lisbon’s 19th-century Ajuda National Palace has previous top-level government experience. Even Prime Minister Luis Montenegro, who promised a Cabinet made up of specialists from outside the usual political circles, has never sat in government before.

Some key members of the Cabinet have spent time in Brussels and are familiar with the European Union’s corridors of power. They include Foreign Minister Paulo Rangel and Defense Minister Nuno Melo, who were European lawmakers from 2009. Portugal, a country of 10.3 million people, is receiving more than 22 billion euros ($23.6 billion) through 2026 from the EU to fuel growth and enable economic reforms.

Finance Minister Joaquim Miranda Sarmento, a Lisbon university professor, is likely to have a prominent role as the new administration seeks to keep a lid on what in the past has been ruinous government overspending. He wants fiscal policies to help drive investment and saving.

Montenegro, the new prime minister, vowed to deliver on his election promises of lower taxes, higher salaries and pensions, and improved public services by making the economy more competitive and the government more efficient.

The government will lower corporate tax from 21% to 15% over the next three years, he said in a speech.

An alliance led by the Social Democratic Party clinched a narrow win in last month’s election, capturing 80 seats in the 230-seat National Assembly, Portugal’s parliament.

The center-left Socialist Party, which for decades has alternated in power with the Social Democrats, collected 78 seats.

A new ingredient is adding to the political unpredictability around the minority government’s prospects: the Chega (Enough) populist party picked up 50 parliamentary seats, up from just 12 in a 2022 election, on a promise to disrupt what it calls the establishment’s politics-as-usual.

Consequently, the election of parliament’s speaker last week brought an unprecedented problem — and an unprecedented solution.

The Chega party made good on its promise to upset the old way of doing things, standing in the way of the incoming government’s candidate for speaker and delivering an embarrassing defeat for Montenegro, the new prime minister and leader of the Social Democratic Party.

Chega leader Andre Ventura wants the Social Democrats to join his party in a right-of-center parliamentary alliance. That would create an overall majority and place Chega at the heart of power. But Montenegro is so far saying no to that.

Instead, Montenegro left Chega out in the cold by striking a deal with the Socialists, his party’s traditional rival, for a speaker named by each party to serve two-year terms.

It’s the kind of deal Montenegro may be forced to do again over the next four years.

On Montenegro’s immediate to-do list is dousing some political fires. He has vowed to quickly address shortcomings in public health care, especially long waiting lists for treatment, and a housing crisis, as well as resolve simmering disputes with police and teachers over pay and work conditions. BARRY HATTON, LISBON, MDT/AP