Why international investors keep choosing Portugal after 18 years of FDI growth

That stock now equals 69.7% of GDP, up from 48.6% in 2007.

Annual FDI flows have followed the same trajectory. They rose from around €2 billion in 2007 to a peak of €13.1 billion in 2024, with fluctuations along the way but a clear upward trend since 2011.

The story behind the numbers is one of changing investor motivation. Portugal was once seen mainly as a cost-competitive base for production. Operating costs still matter, but they no longer explain why multinationals choose the country.

Investment has shifted towards knowledge creation, engineering, technological development and higher-value global functions.

Sectors that historically drove export growth, including automotive components, metalworking, electronics and textiles, now sit alongside a broader range of projects built around software development, artificial intelligence teams, health technologies, renewable energy, digital infrastructure, electric mobility, aerospace and space.

Global service centres illustrate the shift well. Centres that once handled back-office functions have increasingly taken on engineering, cybersecurity, data analytics and AI development work. AICEP estimates that the number of global service centres in Portugal has grown at an average annual rate of more than 10 per cent over the past decade.

Recent strategic investments reflect this trajectory too, including projects by Airbus Atlantic, Lufthansa Technik and Start Campus, alongside the earlier industrial consolidation of Volkswagen Autoeuropa and IKEA Industry and the expansion of Siemens' global capabilities based in Portugal.

Portugal now holds a consolidated position among the top ten FDI recipient countries in Europe, according to benchmarking reports including the EY Europe Attractiveness Survey and the FT fDi Report.

"What's striking about these figures is how much the quality of investment has changed alongside the quantity," said Paul Stannard, chairman and founder of Portugal Pathways and the Portugal Investment Owners Club. "Investors used to ask us about labour costs. Now they're asking about talent pools, energy infrastructure and how quickly they can get through licensing. That's a very different conversation, and it's one Portugal is increasingly well placed to have."

The export figures support the same picture of a more open, more integrated economy. Exports of goods and services rose from 31.2% of GDP in 2007 to 43.7% in 2025, peaking at 49.5% in 2022.

Looking ahead, AICEP expects competitiveness for investment to depend less on financial or tax incentives and more on ecosystem quality, energy infrastructure capacity, particularly the electricity grid, and faster decision-making and licensing processes, especially as competition grows for data centre and AI-related investment.

For anyone weighing an investment move to Portugal, this longer-term shift matters more than any single year's figures. The country's appeal now rests on the depth of its talent pool, its integration into global value chains and its position within the EU, not simply on cost.

Portugal Pathways works with investors, entrepreneurs and family offices exploring residency, investment and business opportunities in Portugal.

Get in touch to discuss how the country's evolving investment landscape might fit your plans.

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About Portugal Pathways

‍‍Portugal Pathways has supported hundreds of Golden Visa residency-by-investment applications and provides expert guidance through its professional supply chain network on estate planning, wealth management, Golden Visa and tax optimisation, including post-NHR / IFICI tax regime planning, as well as private healthcare, money transfers and bespoke relocation and luxury real estate solutions to enhance life and investment in Portugal

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