Space, Defense and Economic Development

Portugal, along with its other Allies, has committed to increasing defense spending to 2% of GDP by 2025. With a gross domestic product estimated at between €270 and €295 billion, this represents an annual investment of around €5.3 to €5.9 billion. Currently, Portugal spends approximately 1.4% of its GDP on defense—a difference of almost €1.5 billion per year. This margin represents a rare opportunity to reassess priorities and invest in strategic sectors with high added value. Space should be among the first.

Space is no longer an area reserved for great powers and has become a force multiplier and a source of resilience for any country. Remote sensing satellites enable continuous surveillance of our Exclusive Economic Zone, covering 1.7 million square kilometers. Satellite communications ensure command and control even when terrestrial networks fail. Space-based warning systems protect critical infrastructure from collisions in orbit and silent phenomena such as climate change. These resources have immediate civilian applications: fighting fires, monitoring fisheries, responding to natural disasters.

Since 2019, NATO has formally recognized space as an operational domain. Investing in this field is therefore not a whim, but a concrete way to fulfill the commitments made while simultaneously strengthening the country's economic competitiveness.

Portugal already has concrete advantages for this challenge. The Azores Spaceport in Santa Maria has a positive feasibility study and ESA approval, potentially putting the country—and Atlantic Europe—on the map for microsatellite launches of up to 3 tons. The national industry, although emerging, demonstrates dynamism and export capacity—with examples such as Tekever, Deimos, Critical Software, and several university spin-offs .

The Atlantic Constellation, a Portuguese-Spanish initiative for ultra-high-resolution observation satellites, already has European funding and a technical roadmap. Furthermore, Portugal hosts two accelerators from NATO's DIANA network, facilitating the development of dual-use technologies.

If Portugal allocated just 10 to 15% of its new budgetary margin—approximately €150 to €225 million per year—it could launch a Space Defense Pillar comparable to that of similarly sized Allies. Over five years, an €880 million budget would allow:

Build a national constellation of surveillance and communications satellites, ensuring 24/7 coverage of the EEZ and autonomy in crisis management;

Create a resilient land segment, with an integrated center serving the Armed Forces, Civil Protection and scientific research;

Fund the Azores “Spaceport” and encourage the micro-launcher industry, ensuring sovereign access to space and boosting the local economy;

Support dual-use technological research, with grants, DIANA programs and access to the European Defense Fund;

Strengthen talent training and retention through STEM courses and university programs focused on CubeSats.

It should be noted that up to 40% of these amounts can be co-financed by European and multilateral instruments, such as the ESA, the European Defence Fund or the IRIS2 secure communications initiative, alleviating the national financial burden.

To realize this vision, five immediate steps are required:

• Publication of the White Paper “Defense and Space 2035”, articulating Defense, Science, Economy and Infrastructure before the 2026 State Budget;
• Creation of a Military Co-investment Fund, with minority public participation in national start-ups focused on dual-use technologies;
• Launch of framework contracts for the acquisition of “data-as-a-service”, promoting national SMEs that provide intelligence and not just hardware;
• Carrying out a joint operational demonstration between the Navy, the Air Force and cutting-edge technology companies in 2026/27, with long-range satellite-linked drones;
• Implementation of an academic program for small satellites, with Atlantic university consortia launching CubeSats and SmallSats, training basic engineers.

It's equally crucial to prevent fragmentation by centralizing acquisitions at the Portuguese Space Agency, in conjunction with the Directorate-General for Defense Resources. And, until the Santa Maria Spaceport is fully operational (expected in 2028), a ride-share-first strategy is essential to mitigate external dependencies.

More than just an expense, this is a strategic investment. By channeling a relatively modest portion of its additional defense effort into the space domain, Portugal not only reinforces its NATO commitments but also gains critical autonomy, international prominence, and a new driver for technological exports. It's an investment that translates into skilled jobs, security in the Atlantic, and sovereign decision-making.

In short, the Space Pillar of Defense will be both insurance for the next decade and a lever for the economy of the future. Missing this opportunity would be a squandering of a rare "two-in-one" public policy solution: strengthening collective security while creating value within the national territory.