Portuguese Prime Minister resigns due to corruption investigations

Prosecutors suspect dozens of national and local policymakers of favoring Portuguese companies over foreign parties in deals for lithium extraction and green hydrogen production.

Antonio Costa is one of them, although it is not yet clear exactly what the suspect is. The current former prime minister announced, in a press conference on Tuesday, that he did not find any criminal suspicion consistent with his country’s leadership. Therefore, he decided to submit his resignation to President Marcelo Rebelo de Sousa.

During a search of Costa’s home and office, police arrested his chief of staff, Vitor Escaría, and one of his advisors, Diogo Lacerda Machado. They are currently in detention because, according to prosecutors, there is a risk of escape.

In the press conference following his resignation announcement, Costa pledged to have a “clear conscience”, not act “reprehensible or unlawfully” and always be committed to his country. He thanked more than 10 million Portuguese for the trust they have placed in him over the past eight years.

Absolute majority

The leftist Costa (62 years old) has ruled Portugal since 2015 and is in his third term. In the last elections in early 2022, his Socialist Party unexpectedly achieved an absolute majority in Parliament.

Costa was known at home and on the European scene as an agile political survivor who delivered on many of his left-wing promises to voters. Thanks to him, Portugal emerged from a deep economic bottom, partly because his governments opened the doors to international business.

One way Costa and his ministers wanted to ensure Portugal’s future prosperity was by extracting lithium, a rare metal that plays a crucial role in the energy transition as a component of electric car batteries.

Costa governments are betting on hydrogen for similar reasons. In the coastal city of Sense, an hour’s drive south of Lisbon, a large hydrogen production center has been established in recent years, partly with European funds. The mayor of the coastal city of Sines was also arrested on Tuesday in connection with the alleged corruption scandal.

This is not the first scandal

The Public Prosecution searched a total of 42 buildings in search of documents and other evidence in the case. The Ministers of Infrastructure, João Galamba for Infrastructure, Environment and Climate and Duarte Cordero are also participating in the research.

This is not the first corruption scandal surrounding this government. Earlier this year, four Cabinet members left the country after an uproar over a generous golden handshake from the former director of airline TAP, which is largely funded by the Portuguese government.

President Rebelo de Sousa is expected to invite all party leaders to a meeting on Wednesday and then decide whether to call new elections or allow the Socialist Party to field a new prime minister.