Monday, March 31, 2025
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Chinese lithium battery factory in Portugal could receive €350 million in EU grants

The Chinese lithium battery manufacturer CALB launched a €2 billion project to build a factory in Sines, southwestern Portugal, which could receive up to €350 million in support from the European Union’s reindustrialisation incentive scheme, according to Euractiv.

The announcement was made during a ceremony at the Superior Technical Institute in Lisbon on Monday, attended by Portuguese Economy Minister Pedro Reis and CALB’s Chairman, Liu Jingyu.

Minister Reis explained that the European incentive scheme for reindustrialisation and innovation allows for support of up to 35% of the total investment, which could amount to €350 million for the CALB project.

The factory, expected to be operational by 2028, will be located in the Sines Industrial and Logistics Zone (ZILS) and is projected to create 1,800 direct jobs.

The project has been submitted to the Portuguese Investment and Foreign Trade Agency (AICEP) to assess its eligibility for public support. Madalena Oliveira e Silva, a manager at AICEP, noted that the contractual process is expected to be finalised in 2025, following detailed discussions on eligible costs, support percentages, and other terms.

Strategic choice of Portugal

CALB’s Chairman, Liu Jingyu, highlighted Portugal’s strategic advantages as the reason for choosing the country as the location for its new ‘Gigafactory’. He cited Portugal’s strong economic potential, skilled workforce, and the logistical benefits of the deep-water port of Sines, which facilitates efficient import and export operations.

When asked about the potential impact on local housing due to the influx of workers, Minister Reis assured that the project includes provisions for community integration and enhancement.

Of course, there is provision for the integration and enhancement of the community.

Regarding the sourcing of lithium, Reis stated that CALB has considered both Portuguese lithium extraction and other sources. He emphasised that the project is designed to be independent and sustainable, regardless of the origin of the raw materials.

Reis described the CALB project as a “big bang” investment that positions Portugal as a key player in the European automotive sector’s value chain.

At a time when the world’s automotive sector, and particularly Europe’s, is facing so many challenges, it is investments like these that are grabbing hold of this value chain in Portugal and giving the entire European sector competitiveness, productivity and technology.

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