Special Advertising Section

Portugal 2000

Crossing New Frontiers

The recently completed Vasco da Gama Bridge

The Lisbon Strategy | Banking Consolidation | E-Business Drive | Adsections Home

ìPortugal stands out as one of the best places to invest in the European Union because it combines the best of both worlds: low operational costs and the economic safety of participating in the EU, the most dynamic economy in the world.î

This is how LuÌs Neto, head of ICEP, Portugalís investment, trade and tourism institute, outlines the advantages of one of Europeís most dynamic economies.

The numbers speak for themselves. In the first five months of this year, ICEP registered 44 investment projects worth more than $5 million each. The trend over the past three years is equally consistent. In 1997, Portugal attracted foreign investment worth $8 billion, $9 billion in 1998 and a record $11 billion last year.

The 16th-Century BelÈm Tower

Motivated Workers

Strong economic growth coupled with full participation in the Euro, the single European currency, is one of Portugalís most important advantages. Foreign investors also cite a business-friendly political structure, a supportive network of national suppliers and, in particular, the high quality of Portugalís dedicated, qualified and flexible workforce.

ìThe mentality of the Portuguese is very important,î says Ulrich Ehmes, managing director of the Portuguese operations of Leica, the German maker of top quality cameras. ìThey are very willing, hard-working, and motivated and they are modest. You will hear the same story from anyone you speak to.î

For the fifth consecutive year, the economy is growing at a strong pace without experiencing any significant inflationary pressures. Interest rates have never been so low on a sustained basis. The jobless rate has fallen to the point of technical full employment.

According to the government, gross domestic product growth will reach 3.3 percent in 2000, up from 3.1 percent in 1999, with inflation falling to 2 percent from 2.3 percent last year. Exports, mostly to other Euro-zone countries, and investment are expected to take over as the main motors of economic growth.

Export growth is expected almost to double to 6.4 percent from 3.3 percent in 1999. Imports are forecast to grow 7.5 percent, slightly up on 1999ís 7.4 percent. Private consumption should rise 3.8 percent, compared with 4.6 percent in 1999.

In a recent report on Portugal, the Organization for Economic Co-operation and Development (OECD) singles out the countryís privatization program, one of the most ambitious in Europe, for special praise. The program ìhas laid the basis for future growth through increased product market competition and enhanced productivity gains,î the report says.