By the summer of 2012 Portugal was on its knees. It suffered more than most during the global credit crisis of 2008 and subsequently in 2011 succumbed to severe austerity measures through the Troika bailout. Fast forward to 2019 and it is now a real success story. By December 2018, Portugal had cleared the remainder of its outstanding debt owed to the IMF following the country’s technical bankruptcy in 2011, which resulted in the IMF/EU/ECB troika running the country’s finances for six years. The original payment plan anticipated the debt would be cleared by 2023 but by settling early, Portugal has saved a total of €1.2Bn in interest payments.
I first noticed Portugal becoming trendy shortly after I moved to Lisbon in the spring of 2014. Tourism was increasing in a spectacular fashion as was the value of the real estate market. This was largely fuelled by pensioners from Northern Europe taking advantage of the Non-Habitual Tax regime (NHR) and non EU individuals wanting to purchase a golden visa, a popular requirement being to invest over €500,000 in property. Many of these high net worth individuals also started to invest and incorporate companies.
The Portuguese economy has grown by an average of 1.9% yearly during the last five years. This is phenomenal when you consider the position the country was in previously. Without looking deeper at the analysis it would be easy to assume that tourism and real estate are largely responsible. This is not the case. Services industries on average have doubled their revenue during the last 12 months. I can relate to this as a business owner of a consultancy company and we have experienced the same growth. The most important contributing factor towards the health of the Portuguese economy is the strength and robustness of the job market. Unemployment in Portugal currently stands at just 6.8%. This is truly amazing when you compare it to France’s 9.3% or even its Iberian neighbour Spain at 15.2%.
Opportunities are not limited to Portugal alone. The country is a natural gateway into the rest of the lusophone speaking world with a market the size of approximately 250 million speakers. Brazil makes up a large proportion but the other countries have a lot of opportunities. These include Angola, Cape Verde, Equatorial Guinea (although a former Spanish colony has Portuguese as one of its official languages) Guinea-Bissau, Mozambique and São Tomé and Príncipe in Africa, Macau in Asia and Timor-Leste in South East Asia. You will find a number of players in Portugal that are present in these markets, especially in the Energy, Infrastructure, Banking and Finance, Technology, Law and Services sectors to name a few.
It is possible to do business in Portugal without speaking the language (although it clearly helps) and the UK enjoys the oldest alliance of any two countries in the world with Portugal. The business community is welcoming, inclusive, fair and respectful towards foreigners. If you are worried about Brexit and thinking about an alternative, Portugal is a wonderful solution and one I guarantee you won’t regret.
CEO, Avanlight Consulting
Avanlight is a boutique consultancy business based in Lisbon, Portugal. Our mission is to help our clients generate new sources of revenue and increase existing business through the successful design and implementation of business development, marketing and communication strategies. We have been increasingly working with international players, often from the UK, looking to relocate or expand their operations to Portugal.