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The worst is behind; a gradual recovery ahead

Last update – 21.06.2021
Business environment risk
Political risk
Commercial risk
Financing risk
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GDP USD237,6861bn (World ranking 48, World Bank 2019)
Population 10,27mn (World ranking 88, World Bank 2019)
Form of state
Parliamentory Democracy
Head of state
Antonio COSTA
Next elections
2021, presidential ; 2023, legislative
  • Improving competitiveness thanks to deep structural reforms (banking sector, pensions, labour market)
  • Modern infrastructure network
  • Large companies with international presence
  • Good performance in some industrial and innovative sectors
  • Buoyant tourism sector
  • Efficient system for R&D, relatively high-skilled labour
  • Still high public debt (among the highest in the world) despite fiscal consolidation efforts
  • High private sector debt
  • Still weak banking system hampering the financing of the economy
  • Number of insolvencies still 30% higher than in 2007

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  Exports Rank Imports  
Spain 25% 1 33% Spain
France 13% 2 14% Germany
Germany 12% 3 8% France
United Kingdom 7% 4 5% Italy
United States 6% 5
5% Netherlands

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Exports Rank Imports
Refined Petroleum Products 6%
7% Cars And Cycles
Miscellaneous Hardware 5%
6% Crude Oil
Paper 5%
5% Plastic Articles
Plastic Articles 5%
4% Pharmaceuticals
Vehicles Components 5%
4% Meat
Payment terms and late payment interest are regulated in accordance with applicable EU rules; however the standards put in place are among the most lenient in Europe. As a result, DSO remains excessive at around 69 days.
The court process is a major complication when it comes to collecting debt and it is advisable to first conduct negotiation with the support of collection specialists. When court is needed, Alternative Dispute Resolution methods and foreign courts (EU judgments will be fairly enforceable in Portugal) may be worth considering in order to avoid inefficient domestic courts.

Despite reforms conducted in 2012 to increase company rescue possibilities, insolvency proceedings often lead to the liquidation of the company and it is rare for unsecured debtors to recover their debt.

Economic Research

Euler Hermes