Some data on Portuguese procurement from IMPIC's 2025 report

IMPIC published recently its yearly report on procurement activity in Portugal for 2025 and as usual it is full of interesting bits of information. Here are a few I thought worth bringing up. Bear in mind that the data is aggregated and not broken down between above and below thresholds.

The total amount of public contracts awarded amounted to almost €25 billion, a new record for the country mostly by the money coming from the Recovery and Resilience Facility which must be spent until August 2026. This is an increase of 14% in total number of contracts and 33% by value. The lion's share of the value increase is on public works as expected. Overall, public procurement represents only 8.1% a marked increase from 6.4%in 2024 but still far, far away from the EU's average of 14-15%. Goods and services represent over 90% of contracts tendered and around 2/3 of the total value spent. Average contract value is not great with €59k for goods and services and €317k for public works.

5500 contracting authorities awarded contracts from a total of over 218k procedures initiated. This means most if not all local authorities including freguesias (parishes) which are tiny are awarding contracts, atomising procurement practice across the country. Unsurprisingly, the most popular award 'procedure' in Portugal is the direct award which was used for 44% of all contracts. When we take into account the prior consultation procedure which is essentially a direct award by any other name, over 60% of procedures in the country are not subject to proper competition.

Even taking into account that the data presented covers both above and below thresholds procurement it does show how bad the competitive situation is in the country. For context, the government approved a recent revision to the Public Contracts Code which will come into force in September that will significantly increase the maximum contract value for both procedures. It is easy to predict what this will mean for procurement competition. For now, taken together these two procedures cover 18% of the total contract value and they have been progressively losing importance since 2021 when they represented 29%. The overwhelming majority of these contracts by number and value are goods and services. It is important to not here as well that the majority of direct awards by number and the overwhelming majority of their spend is not for really low value contracts but instead for situations where the specific grounds are claimed to justify their use. And very often that is just a claim not an explanation or justification to support the choice in according with the legal requirements. This is particularly important since extreme urgency is invoked 88% of the time as a reason to use the direct award, but as I argued here the requirements for its use are tight.

Surprising no one the use of procedures with environmental criteria is really low (1.8%) although this needs to be seen in context, that is, that value is applicable to all public contracts in Portugal, including those below thresholds. Once we focus on the open procedures only, the value increases to 5% and 14% on the barely used restricted procedure.

As for cross-border procurement, 95% of contracts are awarded to local firms, with 3% coming from within the EU and 1% from third countries. Since Spanish firms take around 2/3 of those cross-border contracts, the gravity model of trade is very much applicable and relevant here.

One final comment about the duration of procedures: the vast majority of goods and services are awarded within 59 days of launch and for works that number is around half. Nonetheless, virtually all works procedures (97%) are awarded within 180 days, once again proving that beyond vibes and bad press there is nothing fundamentally wrong with the duration of procurement procedures in the country.

PS: Lots are not popular in Portugal either with them being used in only 9% of contracts.