In a world where companies seek the right combination of talent, innovation, sustainability and global connectivity, Portugal stands out as one of Europe's most compelling destinations for investment and business growth.
Over the past decade, the country has evolved into a dynamic, knowledge-driven economy, attracting multinational corporations, innovative startups and international talent. Supported by a highly qualified workforce, world-class infrastructure and a collaborative innovation ecosystem, Portugal offers businesses more than a favourable location – it offers a platform for long-term success.
Economy of the Year 2025
Recognised by The Economist as the "Economy of the Year 2025", Portugal stands out for its strong economic performance, sound market fundamentals and proven ability to navigate an increasingly complex global environment.
Portugal has demonstrated remarkable economic resilience and stability, combining sustainable growth with sound macroeconomic fundamentals. The country continues to maintain controlled inflation, low unemployment and a strong export orientation, reinforcing its attractiveness for international investors.
At the heart of this success is an economy increasingly driven by knowledge, innovation and international business.
Talent: Portugal's strategic advantage
Portugal's greatest asset is undoubtedly its people.
The country has built a reputation for producing highly skilled, adaptable and internationally minded professionals. Around 30% of university students are enrolled in STEM disciplines, while Portugal boasts the third-highest rate of engineering graduates in Europe.
Portuguese universities consistently perform well in international rankings, with four engineering schools among Europe's top institutions and six business schools recognised among the world's best.
Language capabilities further strengthen the country's competitiveness. Portugal ranks among the world's leading nations for English proficiency, making collaboration with international teams seamless and efficient.
For companies establishing operations in Europe, access to qualified talent is no longer a challenge – it is a strategic advantage.
Where innovation thrives
Innovation is deeply embedded in Portugal's economic model.
The country has developed a vibrant ecosystem that brings together universities, research institutions, startups and multinational corporations. Research and development investment continues to grow, while patent applications have increased significantly in recent years across high-value industries.
Global companies including Bosch, Continental, Teamviewer and Siemens have established major innovation and technology centres in Portugal, working closely with universities and research organisations to develop next-generation products and solutions.
This collaborative approach creates an environment where ideas move quickly from research to commercial application.
A startup nation with global ambition
Portugal has become one of Europe's most dynamic startup ecosystems.
Today, more than 5,000 startups operate across the country, supported by a nationwide network of incubators, accelerators and innovation centres. Cities such as Lisbon, Porto, Braga and Aveiro have become vibrant hubs of entrepreneurship, attracting founders, investors and international talent.
The emergence of several globally recognised unicorns demonstrates Portugal's capacity to create internationally competitive technology companies.
The result is an entrepreneurial ecosystem that combines creativity, ambition and global reach.
Connected to the world
Portugal combines excellent physical and digital connectivity with a strategic Atlantic location that links Europe to Africa, the Americas, the Middle East and Asia.
An expanding network of submarine cables, modern ports, international airports and efficient transport infrastructure reinforces the country's role as a gateway for global trade, investment and digital services.
For internationally oriented businesses, Portugal offers the connectivity required to compete in a global economy.
Leading the green transition
Sustainability has become a defining characteristic of Portugal's development strategy.
More than 75% of the country's electricity is generated from renewable sources, supported by significant investments in wind, solar and hydropower. Portugal's early transition away from coal and strong climate performance reflect a long-term commitment to decarbonisation and energy independence.
As companies increasingly seek sustainable business locations, Portugal offers access to cleaner energy, competitive electricity costs and a favourable environment for responsible growth.
- #12 worldwide for renewable energy capacity (2024)
- #12 worldwide in the Climate Change Performance Index
- #3 in Europe for the lowest wholesale electricity prices (2025)
- 4th EU Member State to become coal-free (2021)
A strategic gateway to global markets
Portugal's location offers significant advantages for international companies.
As a member of the European Union, the country provides direct access to one of the world's largest single markets. At the same time, its longstanding cultural and economic ties with Portuguese-speaking countries create unique opportunities for international expansion.
Combined with modern logistics infrastructure and excellent international connectivity, Portugal serves as a natural bridge between continents.
A place where people want to live
Business success increasingly depends on the ability to attract and retain talent. In this regard, Portugal enjoys a distinct advantage.
Consistently ranked among the world's best countries for quality of life, Portugal offers a safe, welcoming and inclusive environment. A mild climate, nearly 2,800 hours of sunshine per year, competitive living costs and internationally recognised healthcare and education systems make the country particularly attractive for international professionals and their families.
For employers, this translates into a powerful recruitment and retention advantage.
A country recognised by the numbers
Portugal's competitiveness is increasingly reflected in international rankings, confirming its position as one of Europe's most attractive destinations for investment, innovation and talent.
International recognition
- Economy of the Year 2025 (The Economist)
- #9 Top Destination for FDI in Europe (EY European Investment Monitor 2025)
- #7 Safest Country in the World (Global Peace Index 2025)
- #10 Best Country for Expatriates' Quality of Life (InterNations Expat Insider 2025)
- #3 Highest Rate of Engineering Graduates in Europe (Eurostat, 2023)
- #4 Worldwide in the Global Cybersecurity Index (ITU, 2024)
Why Portugal?
✓ Highly qualified talent
✓ World-class innovation ecosystem
✓ Competitive and sustainable energy mix
✓ Strategic location and global connectivity
✓ Stable and business-friendly environment
✓ Safe, welcoming and inclusive society
✓ Exceptional quality of life
These strengths make Portugal a natural choice for companies looking to innovate, invest, grow and compete internationally.
Portugal's digital transformation
Portugal has quietly become one of Europe’s most advanced digital government success stories. While the country is often celebrated for its quality of life, connectivity infrastructure and innovation ecosystem, it is equally noteworthy for the way it has transformed public services into a digital-first experience for citizens and businesses.
Today, Portuguese citizens can access a growing range of government services through digital channels that are secure, interoperable and designed around user needs. Digital identity cards and driving licences are legally valid nationwide through mobile applications, medical prescriptions can be issued electronically, official documents can be signed digitally, and tax returns are largely pre-filled by public authorities. At the same time, Portugal has invested in assisted digital services to ensure that the benefits of digitalisation remain accessible to all citizens, regardless of digital literacy levels.
Europe’s first Business Wallet
A key milestone in this journey has been the launch of Europe’s first Business Wallet, extending digital identity mechanisms to companies and public administrations. The initiative aims to provide organisations with a single legal digital identity capable of operating seamlessly across borders, reinforcing Portugal’s ambition to position itself at the forefront of Europe’s digital transformation.
Portugal’s digital government strategy is based on a coordinated and integrated approach involving different levels of public administration. Under the leadership of ARTE – the State Technological Reform Agency – the government has prioritised interoperability, secure authentication and citizen-centred service design.
Rather than viewing digitalisation as a technology project alone, Portugal has focused on creating the foundations for a seamless relationship between citizens, businesses and the state. The objective is to ensure that public services are available whenever and wherever they are needed, while reducing bureaucracy and administrative burden.
This commitment to digital governance also extends internationally. Portugal currently chairs the Digital Identity Thematic Group within the Digital Nations network, sharing best practices and contributing to the evolution of digital identity models that can be adopted by governments around the world.
International recognition: Europe’s leading digital government
Portugal’s achievements have received strong international recognition. According to the OECD Digital Government Index 2025, Portugal ranks 3rd globally with a score of 86%, behind only South Korea (95%) and Australia (88%), making it the highest-ranked European country in the assessment.
The OECD index evaluates governments across six dimensions of digital maturity: digital-by-design, data-driven government, government-as-a-platform, open-by-default approaches, user-driven service design and proactiveness. Portugal’s position reflects more than a decade of sustained investment in interoperable digital services, secure digital identity, citizen-centred public administration and data-driven policymaking.
The ranking provides independent validation of Portugal’s digital transformation strategy and reinforces its position as one of the world’s leading digital governments. At a time when governments across the globe are striving to modernise public services, Portugal has established itself as a benchmark for how digital technologies can improve the relationship between citizens, businesses and the state.
Portugal’s public sector digital achievements are supported by a broader digital economy that has become a significant contributor to national development.
According to the Impact of the Digital Economy in Portugal 2025 study, conducted by GoingNext and Porto Business School, the Portuguese digital economy generates €213 billion in output, €90 billion in gross value added (GVA) and supports nearly three million jobs. Digital activities now account for 39% of national output, 13% of GVA and 23% of employment.
The study also highlights the country's robust digital infrastructure. By 2025, 89% of the population uses the internet, representing approximately 9.27 million users, while active mobile connections exceed 14 million, equivalent to 135% of the population. Average download speeds reach 79.7 Mbps on mobile networks and 195.9 Mbps on fixed networks, demonstrating a highly developed connectivity environment.
These foundations have helped create the conditions for a mature digital public sector, enabling citizens and businesses to interact with government services online as part of their everyday lives.
Digital Government performing above the European average
The findings of the same study suggest that Portugal’s digital public administration compares favourably with its European peers.
According to the European eGovernment Benchmark, Portugal achieved 86.4 points in the 2026 evaluation of digital public services for citizens, exceeding the European Union average of 84.6 points; Portugal also achieved 90 points in the 2026 evaluation of digital public services for businesses, exceeding the European Union average of 88.6 points.
Digitalisation is now well established across both central and local government, with notable progress in cloud adoption, data protection and online communication channels. Importantly, these achievements have been realised without disproportionate public expenditure. Portuguese public employment levels remain broadly aligned with the European average, while public administration expenditure as a share of GDP remains below that of several European countries that continue to face significant challenges in public service delivery.
The next challenge: Unlocking the full value of digitalisation
Yet Portugal’s digital transformation story is not complete.
While the country performs strongly in infrastructure, connectivity and service quality, experts argue that the next phase will depend less on technology deployment and more on the effective use of advanced digital capabilities.
The Impact of the Digital Economy in Portugal 2025 study notes that the greatest gains in productivity emerge when organisations adopt high-value technologies such as cloud computing, artificial intelligence and intelligent automation.
Administrative simplification remains a priority, as does the need to continue investing in digital skills across government, business and society. Policymakers recognise that digital transformation must be accompanied by workforce development and improvements in digital literacy to prevent exclusion and ensure that all citizens can benefit from the transition.
From a connected country to an intelligent country
The broader challenge was captured by José Esteves, Dean of Porto Business School, who argues that Portugal has already achieved the essentials: excellent digital infrastructure, a more agile public administration and citizens who are comfortable living online.
The next step, however, is to evolve from a “connected” country into an “intelligent” one.
This means using digital technologies not merely to improve efficiency, but to address structural challenges such as productivity, demographic change and inequality. It means transforming digitalisation into sustainable economic and social value, ensuring that technological progress delivers greater inclusion, innovation and public sector effectiveness across the entire territory.
In many respects, Portugal’s digital public sector has already become a European benchmark. Portugal’s experience demonstrates that digital government is no longer simply about putting services online. The country has built a mature and trusted digital ecosystem that is recognised internationally. The challenge now is to leverage emerging technologies and new ways of working to unlock the next wave of public value.
