Portugal’s $9.9 Billion Tech Gamble: How Data Centers and Renewable Energy Are Reshaping Its Economy in 2025

• Why Is Portugal Shifting From Tourism to Tech?
• What’s Driving Sines’ Tech Boom?
• How Are Global Players Investing in Portugal’s Future?
• Why Are Locals Skeptical of the Government’s Promises?
• Can Portugal Balance Growth With Sustainability?
• FAQs About Portugal’s Tech Transformation

Portugal, long reliant on tourism, is betting big on tech infrastructure to diversify its economy. The coastal city of Sines is at the heart of this transformation, with a massive €8.5 billion ($9.9 billion) data center project led by Start Campus, alongside a Chinese battery factory and port expansions. While the government touts this as an economic revolution, locals remain skeptical due to persistent infrastructure gaps. Here’s the inside story of Portugal’s high-stakes pivot.

Why Is Portugal Shifting From Tourism to Tech?

For decades, Portugal’s sunny beaches and surf towns have been its economic lifeline, drawing millions of tourists annually. But in 2025, the country is making a bold play to reduce its reliance on seasonal visitors. The catalyst? A web of undersea cables in Sines that connect Europe to Brazil, Africa, and soon South Carolina via a new Google link. This infrastructure positions Sines as a prime hub for data traffic—a potential goldmine in the digital age.

What’s Driving Sines’ Tech Boom?

The crown jewel of Portugal’s tech push is Start Campus’s €8.5 billion data center, which aims to be one of Europe’s largest. The first building opened in March 2025, hosting cloud services for clients like Nvidia and Microsoft. By 2030, the facility will expand to six buildings, all powered entirely by renewables. Ironically, it’s built next to a defunct 1970s power plant—a symbol of Portugal’s past industrial failures. Even the plant’s old cooling systems are being repurposed for the new project, blending history with innovation.

How Are Global Players Investing in Portugal’s Future?

Beyond data centers, China’s CALB Group is building a €2 billion battery factory in Sines, set to produce enough batteries for 200,000 EVs annually by 2028. The Port of Singapore Authority is also doubling the local deepwater terminal’s capacity. Combined, these projects represent 4.6% of Portugal’s GDP and promise over 5,000 jobs. Economy Minister Manuel Castro Almeida calls Sines “the heart of Portugal’s economic transformation.”

Why Are Locals Skeptical of the Government’s Promises?

Residents remember the 1970s refinery boom that fizzled after the 1974 revolution. Today, housing shortages and outdated transport—like slow freight trains and no passenger rail to Sines—fuel doubts. “I was told for years there wasn’t enough traffic to justify a highway,” says Pedro do Ramos of the Port Authority. “Now there’s too much.” Despite billions in investment, locals say infrastructure remains a bottleneck.

Can Portugal Balance Growth With Sustainability?

The data center’s 100% renewable energy model sets a precedent, but challenges like delayed highway projects and strained public services persist. As one resident put it, “We’ve seen big plans before. This time, we’ll believe it when we see it.”

FAQs About Portugal’s Tech Transformation

What companies are involved in Portugal’s data center project?

Start Campus is leading the development, with Nvidia and Microsoft as key tenants.

How will the battery factory impact Portugal’s economy?

CALB Group’s factory is expected to create 1,800 jobs and supply batteries for 200,000 EVs yearly by 2028.

What are the biggest hurdles for Sines’ growth?

Housing shortages, slow freight rail, and delayed highway projects top the list.