Portugal’s latest innovative idea to entice foreign investment and transform their country into a hub for entrepreneurship includes setting up “free zones” with special regulations to allow for testing of emerging technologies, such as self-driving vehicles and drones.

One of the people on the forefront of this is Industry Secretary Ana Lehman. “We are working a lot on the regulatory and legal aspects because this is really totally fundamental for opportunities in this area,” she said. “One of the areas we are working on has to do with technological free zones and drones is one of the areas we want to promote...another is autonomous vehicles.”

Currently, Portuguese law prohibits the use of driverless cars in public roads whilst, for security purposes, the use of flying drones has also been severely restricted.

“We are studying some locations and what is needed...within a legal framework that is very careful because these technologies have an impact”, Lehman said. “This is a delicate topic and we want to do it properly.”

The last few years has seen a sharp rise in technology start-ups across Portugal, thanks in part to events such as the recently held Web Summit and Government incentives like the 200m venture capital fund.

In fact, such initiatives in the technology sector has helped Portugal towards recording its highest level of economic growth in over a decade. These companies are also attracted by the country’s low cost of living, skilled workforce and cheap property.

The setting up of free zones will further solidify the nation’s efforts towards becoming a tech hub.

One of the companies set to benefit from this scheme includes one of Portugal’s leading tech firms, Veniam, which develops wireless networks for public transport and is looking to adapt this technology onto driverless cars.

Furthermore, earlier this year, Mercedes-Benz opened a digital centre in Lisbon, which includes development of autonomous vehicle technology.

The Government is also lobbying Tesla to set up a factory there. The country has the largest Lithium reserves in all of Europe.