Portugal has emerged as a leading destination for foreign direct investment (FDI), securing second place in Western Europe and 16th globally according to the latest Greenfield FDI Performance Index. This ranking highlights Portugal’s appeal as a strategic location for international business expansion, particularly in sectors such as renewable energy, technology, and advanced manufacturing.
The Greenfield FDI Performance Index evaluates countries based on their ability to attract new investment projects relative to the size of their economies. Portugal’s ranking indicates that it effectively attracts capital and international companies, outperforming larger economies that typically dominate such lists. In 2025, Portugal’s performance reflects its competitive advantages, including its geographic location, EU membership, skilled workforce, and developing infrastructure.
The report emphasizes that smaller and mid-sized countries can excel in attracting investment when they offer favorable conditions. Portugal’s consistent growth in sectors like renewable energy showcases its adaptability and commitment to innovation. In the renewable energy sector, the country has made significant strides in harnessing solar and wind energy, contributing to its attractiveness for potential investors.
Only Monaco ranked higher than Portugal in Western Europe, with its standing based on a limited number of specialized investment projects. Spain follows closely, indicating a robust investment climate across the Iberian Peninsula. Both Portugal and Spain experienced an increase in investment projects in 2024 compared to the previous year, even though their index scores slightly declined due to a faster-than-average GDP growth in the euro area. This trend suggests that despite economic expansion, both countries maintain strong capabilities to attract investment beyond their economic size.
Portugal’s position in the global investment landscape reflects a shift from being a destination for traditional sectors to becoming a hub for high-value, future-oriented projects. To sustain its momentum, Portugal must enhance its business environment, foster innovation, and focus on industries where it can excel, such as green technologies and digital industries. The data underscores Portugal’s evolving role and affirms its competitiveness in the international investment arena, encouraging both local and foreign entities to engage with its growing economy.
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