By Manuel Belo Moreira, honorary professor at the University of Lisbon and president of CIRIEC-Portugal
The social economy (SE) sector in Portugal dates back at least two centuries and has the capacity to combine justice and efficiency. This capacity stems from the fact that social economy entities address territorial needs, are managed by the community, and decide internally on the distribution of profits. However, regrettably, the social economy sector is relatively weak.
For example, the contribution of the SE to Gross Domestic Product (GDP) is around 3.2%, and to employment 5.9% (data from the Portuguese National Statistics Office). This places the Portuguese Social Economy below the average level of European countries where the social economy is more developed.
To seek an explanation, we must consider both historical roots and more recent drivers. From a historical perspective, Portugal, under the Salazar regime, imposed a firm state policy that diverged from the prevailing democracies in European countries. This policy consisted of maintaining strict control over economic activities to avoid competition and to favor state intervention that prevented individual initiative, such as decisions based on community rules, workers’ associations, and academic entrepreneurship. This behavior of the regime was supported by the superstructural forces that constituted its base, despite the fact that such control hindered Portuguese economic and social development.
Nevertheless, some social economy institutions were accepted, particularly Catholic assistance institutions, the misericórdias, but the regime was especially vigilant in preventing any type of independent cooperative. Moreover, the few existing credit cooperatives were shut down, and the creation of new ones was never allowed.
The situation changed after the 1974 Revolution, to the point that the cooperative movement obtained a special constitutional status. Independent cooperatives flourished and, for some years, collective action prospered, encompassing economic, sporting, and cultural activities.
However, numerous political, economic, social, and ideological forces questioned many examples of collective action, such as SAAL, a movement based on self-construction of housing, not to mention the opposition to Agrarian Reform. In any case, from a political standpoint, the constitutional imperative to promote cooperativism gradually faded—not from the Constitution itself, but from existing policies.
Only during the years following the Revolution did the economic sector of the social economy gain the support of political forces to confront the current situation, in which the State ignores or hinders cooperative development. One example of this political climate is the withdrawal of the State from CASES (Cooperativa António Sérgio para a Economia Social), a regional cooperative with an essential role assigned by Law No. 30/2013.
This is linked to the dominant socioeconomic ideology, which prioritizes individualism over collective gains and therefore forgets that there are intrinsic economic values that are not measured by price. In other words, the challenge we face today lies fundamentally in the failures of both the State and the market.
This reality reflects another Portuguese misconception about the social economy sector and its importance. In contrast, for example, to the Spanish government, which has a Ministry for this sector, the Portuguese government is closing the national agency for the promotion of cooperativism and the social economy, CASES.
While we face the aforementioned challenges and threats looming over the Social Economy in Portugal—particularly cooperatives that compete in the market—the welfare sector has focused on providing assistance to the most disadvantaged groups, especially older people, represented by IPSS (Instituições Particulares de Segurança Social, most of them linked to the Catholic Church), or foundations, which concentrate the attention and favors of recent governments.
It is time to mention some hopes.
The number and severity of the problems affecting the Portuguese economy and society, as well as those of other European and non-European countries, are well identified—particularly affordable housing, health for all, and the consequences of growing inequality.
Optimism is based on the fact that these problems are precisely those that market forces cannot or do not want to address, which opens opportunities for decision-makers, instead of ignoring the Social Economy, to design strategies to develop support for the necessary collective actions. In particular, I am optimistic that local authorities will begin to rely on socioeconomic institutions to promote local or regional development through public-social partnerships, very different from the usual public-private partnerships (PPPs), which only become attractive to the capitalist private sector when the State offers sufficient guarantees that the PPP will generate the desired profitability.
One of the reasons for this optimism derives from the study carried out by CIRIEC-Portugal, recommended by CIM Oeste, in which 12 municipalities from the Oeste Region participated. The study has also given its title to the XI Iberian Colloquium 2026 – “Social Economy and Territorial Cooperation”, which will be held in Lisbon and Caldas da Rainha from May 27 to 29, 2026, with the collaboration of CIRIEC-Spain and CIRIEC-International.
