Portugal has strongly expanded its research and innovation (R&I) system from a very low base. The country has significantly increased both the number of people with tertiary education and the number of science and engineering graduates. This development has had a positive impact on Portugal’s scientific production and level of scientific excellence. However, R&D intensity has been decreasing since 2009, moving away from the EU average. This trend is largely driven by a lack of innovation-friendly framework conditions for business R&I investment in Portugal and by weak and fragmented incentives for cooperation between science and business.
Leveraging business R&I through science-business cooperation remains a key challenge. The country is well below the EU average in science-business cooperation and in the commercialisation of knowledge. At the same time, the institutional framework does not include incentives to foster cooperation between academia and industry. Therefore, ensuring an investment-friendly business environment capable of supporting the creation and scaling-up of fast-growing firms in innovative sectors is key to enable structural change towards a more innovation-driven economy.