Fitch praises Portugal’s economic progress

The agency – which has rated Portugal in its top ‘A’ bracket – says its "reduction in the debt-to-GDP ratio has fallen sharply since the 2020 peaks, far outpacing the euro area average".

This decline culminated in 2025 with a historic drop in the public debt ratio, which fell to 89.7% of GDP, beating the 90.2% target set in the 2025 state budget.

The 3.8 percentage point drop, compared to the end of 2024, pushed the debt burden below the 90% threshold for the first time since 2009.

The downward trend is expected to continue, with the government estimating debt-to-GDP ratio will hit 87.5% in 2026.

Minister of State for Finance, Joaquim Miranda Sarmento, said: “This decline is the result of the efforts of families and businesses in recent years.

“The pace of public debt reduction needs to be maintained.

“In addition, we need to sharply cut bureaucracy, which is suffocating businesses and citizens and holding back and delaying private investment, especially Foreign Direct Investment.”

Currently, all major credit rating agencies place Portugal's rating in the ‘A’ tier - the highest classification bracket.

In addition, Fitch Ratings, Standard & Poor's (S&P), and Morningstar DBRS (DBRS) have recently revised Portugal's outlook from ‘stable’ to ‘positive’.

Paul Stannard, chairman and founder of Portugal Pathways and the Portugal Investment Owners Club, added: “The handling of Portugal’s economy has been key to it emerging as one of Europe’s most attractive to invest nations.

“With debt continuing to fall, investors will continue to sit up and take notice.”

To find out more about investing in Portugal, arrange a free discovery call with Portugal Pathways.

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About Portugal Pathways

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