Where better to explore Portugal’s investment potential and its ties with Belgium than at the Lindeman Brewery in the outskirts of Brussels? Having lived in Lisbon from 2021 to 2023, I was instantly reminded of the charm of the Portuguese language upon hearing the familiar sounds of “oi” and “sh” as I arrived at the event organised by Caixa Geral de Depósitos, Portugal’s largest bank. Conversations with fellow attendees brought back fond memories of the Southern European way of life: the warm sun, unhurried daily rhythm and ease of appreciation for life’s simple pleasures.
When I left the capital, the foreign investment boom was accelerating: construction works spreading across the city and the streets buzzed with an increasing number of international voices. These memories heightened my anticipation to learn how Portugal’s investment landscape has evolved since then.
1. Portugal’s rising appeal
Portugal has steadily positioned itself as a key destination for international investment since the turn of this century. The country’s strategic location lies between Europe, Africa, and the Americas, making it a natural gateway for global trade. Once Europe’s “best kept secret” as stated by Pedro Fontainhas, Managing Director of Portugal’s Residential Tourism and Resorts Association (APR), there has been a monumental advancement in the country’s development over the last twenty years.
International organisations like AICEP (Portugal’s trade and investment agency) have been instrumental in fostering trade relations and attracting foreign direct investment (FDI). Export growth has been a key metric in Portugal’s economic development along with an openness to global business, with the OECD ranking it the second most open country for FDI in 2020 among 68 OECD nations. Notable trade links include strong partnerships with Belgium, Portugal’s 8th largest client and supplier for goods and services and the 12th largest direct investor.
A leader in renewable energy, the country produces over 70% of its electricity from renewable sources, according to 2023 AICEP statistic. Portugal’s competitive edge extends to its thriving startup ecosystem, which boasts over 4,000 startups (70% created in the last five years), five tech unicorns, and 150+ incubators and accelerators. These attributes, coupled with an educated workforce (#25 IMD world rating) ranking highly in language and business skills, makes the country an innovation hub.
2. Fostering investor confidence
Portugal has made significant strides in cultivating a desirable investment environment. Caixa Geral de Depósitos plays a pivotal role in supporting businesses and investors. Since 2016, the institution has consistently increased its net income, reaching €1,369 million in Q4 2024 — a 38.7% surge from €987 million in Q4 2023 — driven by strong capital gains and growing client trust. CGD’s international presence, including branches in Belgium and France, facilitates cross-border business connections, particularly between Europe and Portuguese-speaking nations such as Brazil, Angola, and Mozambique.
During the panel discussion at the event, investment representatives emphasised the importance of aligning investors with trusted institutions and offering a “soft landing” approach to ensure smooth transitions. The Madeira region stands out as an attractive destination, offering high incentive tax systems, including a reduced international tax rate of just 5% for foreign companies, pointed out Kathleen Figueiredo Lassy, Head of Madeira Office in Brussels. Moreover, its growing reputation as a digital nomad haven enhances its appeal, fostering a vibrant environment for entrepreneurial activity. The Azores islands are currently developing an investor guide to showcase opportunity.
3. Advantages of living and investing in Portugal
Beyond economic opportunities, Portugal offers an enviable quality of life. With 300 days of sunshine annually in most regions, a rich cultural heritage, and white sand beaches, it’s no wonder the country has become a prime destination for residential tourism. Affordable living costs — approximately 13% cheaper than Brussels — and robust infrastructure, including international-standard healthcare and six international airports, further enhance its attractiveness.
For those seeking investment opportunities, the real estate sector is particularly enticing. Prices in regions like the Algarve are rising at a steady rate of 8% annually, while tax incentives such as the non-habitual resident (NHR) regime offer significant benefits to foreign investors and retirees. Properties can also be monetised through tourist rentals, providing a steady income stream.
Legal frameworks for foreign investment are straightforward. Portugal imposes no restrictions on foreign ownership, allows free transfer of profits and dividends, and provides a simplified process for setting up local branches of international companies. For real estate purchases, acquiring a taxpayer number (NIF) and a Portuguese bank account are the main prerequisites.
4. A gateway to the future
From picturesque landscapes to forward-thinking policies, Portugal offers more than just a promising investment destination — it provides a lifestyle embedded with enjoyment, culture, and opportunity. The country’s ability to attract and retain international interest, even amid global economic challenges, demonstrates its resilience and adaptability.
As I reflected on the conversations at the event, one thing became clear: the ship hasn’t yet sailed for Portugal. There are regions still to make their mark and whether through green energy initiatives, innovative entrepreneurship, or thriving real estate market, the nation will continue to draw investors and residents alike, making Portugal a destination where ambition and quality of life can converge.
