Nvidia on board as Portugal bids to host European AI ‘gigafactory’

Tech giant Nvidia has joined a national consortium chasing a multi-billion-euro bid to secure an AI gigafactory in Portugal.

Five planned AI (artificial intelligence) gigafactories are planned in the European Union with Portugal among the nations bidding to be selected.

US firm Nvidia is working alongside Banco de Fomento which is spearheading the bid.

The project, estimated at €4 billion, could see a major data centre established in Sines, powered by 100,000 advanced graphics processing units (GPUs).

Banco de Fomento’s chief executive, Gonçalo Regalado, revealed at the Fusion conference in Lisbon that the consortium has secured backing from leading global players.

He explained: “We have the will, we have the agreement, and we have the biggest global players behind the bid.

“The 100,000 GPUs are guaranteed for the factory to be built in Sines.”

Regalado stressed the initiative brings together a strong mix of national and international partners.

Nvidia manufactures the H100 processors required for the facility, each worth about €22,000, and their participation adds significant weight to Portugal’s proposal ahead of the European Commission’s official tender later this year. The site in Sines is projected to create around 270 jobs.

The Portuguese government and civil society institutions are also backing the bid, which will compete with other member states under the EU’s public-private partnership programme.

Paul Stannard, Chairman and Founder of Portugal Pathways and the Portugal Investment Owners Club, says: “Portugal is positioning itself as one of Europe’s rising tech hubs. The tech start-up scene across the country is thriving in Lisbon and Porto, but even cities like Braga are seeing massive progress, with the latter awarded the title of European Capital of Innovation last year.

“The IFICI (NHR 2.0) tax regime incentivises some of these start-ups with benefits such as a flat 20% personal income tax rate for 10 years and exemptions on eligible foreign-sourced income like dividends and capital gains.

“Portugal is perfectly placed for AI investment, and a project like this would really cement the country’s role in the future of global technology innovations.”

The Commission is expected to select five gigafactory sites across Europe, together representing roughly €20 billion in investment, as part of its wider €200 billion InvestAI strategy.

Nvidia’s interest in Portugal does not preclude its involvement elsewhere. The company is also supporting a Spanish application for a gigafactory in Móra la Nova, Tarragona, where a consortium of major technology and industrial firms has already lodged its proposal with Brussels.

Regalado downplayed suggestions of a direct competition with Spain, noting that Portugal has chosen a united approach with a single application, while its neighbour has submitted four separate bids.

For Nvidia, the move comes as the company continues to expand aggressively. Valued at $4.46 trillion and currently the largest company on the S&P 500, it has recently announced plans to invest up to $100 billion in OpenAI and has taken steps towards acquiring a stake in Intel.

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