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Although the Portuguese ruled over a huge trading empire a few hundred years ago, the country is today among the poorest in Western Europe. During Salazar's dictatorship, the State took over most industries and created a cumbersome, outdated bureaucracy that still poses a problem for the Portuguese economy. To make matters worse, the country’s educational infrastructure had been neglected until the early 2000s, when a drive for modernization and upgrade took place.
The country has since the 1970s has developed a relatively modern industry where the once dominant agriculture has decreased dramatically at the expense of the growing trade and service sector. In particular, tourism has increased considerably in recent years, accounting for a large part of the country’s gross domestic product (GDP). In the early 2000s, Portugal had a budget deficit of more than 3 per cent of GDP, which is contrary to the rules of the European Monetary Union which the country is part of. The resultant measures of economic austerity led to protests and strikes in the country. Owing to the underdeveloped economy, Portugal is one of the euro countries that was hardest hit by the global financial crisis of 2008. Consequently, in the spring of 2011, the country was forced to ask the EU for a bailout.
The growth rate of the Portuguese GDP was in the positive, at 0.6 percent, for the second time in 7 years since the financial crisis. Unemployment continues to be a problem, however, with a relatively high rate of 13.6 percent.
Portugal’s main exports petroleum products, vehicle parts, leather products and paper. The main trading partners of the country are Spain, France, Germany, China and the UK.
Why invest in Portugal?
- More than half of the Portuguese population speaks one foreign language or more. Furthermore, English is a compulsory language from elementary school.
- Portugal is ideally located in Eastern Europe. It has the same time-zone as the UK and Ireland and a one hour difference from the Central European Time. In addition, due to its reach in the North Atlantic, it is the closest European country to both Canada and the United States.
- Portugal has one of the best transport infrastructures in Europe. Its road and motorways network warrants special mention in particular as it is ranked as among the 5 best in the world.
- Much of the country’s skilled labour specializes in engineering, technology and mathematics.