Portugal climbed two positions and is now considered the eighth most attractive country in Europe for Foreign Direct Investment (FDI), according to the EY European Attractiveness Survey 2022.
“Portugal has risen to eighth place on the European ranking of countries with the most Foreign Direct Investment (FDI) projects announced in 2021, a year in which the Portuguese economy grew at its best pace in decades, following the sharp contraction caused by the Covid-19 pandemic,” said the consultancy EY, in a statement released on Thursday.
According to the study, in 2021 Portugal attracted 200 FDI projects, which represents a 30% increase compared to the 154 announced in 2020. Last year, Portugal climbed two positions in this ranking to 8th place, and is currently ahead of countries such as Poland and Ireland, which ranked 9th and 10th, respectively.
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Last year, 5,877 foreign direct investment projects were announced in Europe, that is, a figure 5% higher compared to that recorded in 2020, but 12% below the maximum observed in 2017.
This performance is explained by the “efforts undertaken by the European Commission to promote growth in the region” with 63% of respondents pointing out that the “European Recovery and Resilience Fund was a decisive factor in the decision to maintain or extend operations in Europe”.
Nevertheless, investors admit that “the new geopolitical and economic environment”, namely due to the Russian invasion of Ukraine, may penalise “the immediate attractiveness of Europe”. Still, the long-term outlook is encouraging, with 64% of respondents confident that Europe’s attractiveness will improve over the next three years.
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France was considered the most attractive economy when it comes to foreign direct investment, attracting 1,222 FDI projects in 2021, an increase of 24% year-on-year. This performance is explained by the “post-pandemic recovery and the Macron reforms,” the consultancy firm added.
The United Kingdom follows it, with 993 projects (an increase of 2% compared to 2020) and Germany, with 841 FDI projects, that is, a decrease of 10% compared to the figure recorded the previous year. “However, the country also attracted large industrial projects, especially in the automotive and electronics sectors,” concludes EY, in the press release.