Portugal: An attractive business hub for GCC and the Middle East nationals

A growing number of wealthy individuals and investors are looking to settle in Portugal. The number of expats increased by 12.2% in 2020 compared to 2019, reaching 662,095 permanent foreigners, according to the Asylum, Borders, and Immigration Report (RIFA). Portugal Golden Visa by investment scheme is attracting attention in the Middle East, with people residing in UAE, Egypt, India, and Pakistan among the most common applicants, according to the country’s Ministry of Foreign Affairs.?

For wealthy individuals from the Middle East and Gulf countries looking to flee political tensions, make a lucrative investment, get a second passport from an EU country, or seek a better quality of life, Portugal has a lot to offer. It is now globally recognized as a competitive, and innovative location for investments across all economic sectors. It has demonstrated in recent years its capabilities beyond manufacturing, trade, and tourism, but also in the services sector including IT, Research and Development (R&D), as well as attracting value-added investments. Quality of life, low cost of living, and top-notch healthcare and education services are acting as a magnet for people seeking a change of life.?

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Stable economy

Although the Portugal’s economy was severely impacted by Covid-19 pandemic, it proved to be more resilient than expected. The GDP grew by 4.8% in 2021 and is predicted to rise by 5.6% in 2022, indicating that there is more hope and confidence for businesses. Portugal is considered an attractive market for international investors due to its steady currency, and robust returns on real estate and local investment funds. Individuals looking to obtain Portugal Residency by Investment can take advantage of the extremely low cost of living. For instance, Lisbon is estimated to be around 57% cheaper than New York, 46% cheaper than London, and 6% cheaper than Madrid. English is widely spoken allowing for easy international communication.

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Stable real estate market

Real estate is anticipated to continue to be the main engine of the Portuguese economy’s revival, and a profitable investment opportunity for individuals looking to acquire a Portuguese residency. When it comes to rental activities, condominium fees are relatively low or non-existent. Renting apartments using internet rental services such as Airbnb and Booking has grown commonplace in many cities. In addition, the government enables the use of the simplified method (presumed profit) for the payment of income tax on short-term rentals. Regarding real estate valuation, the arrival of people and investors from all over the world has kept the demand for properties strong. However, the quantity of available residential apartments and houses is far less than the number of buyers. The price of real estate will surge at the same pace, as cities grow due to the arrival of new enterprises. As a result, investing in Portugal’s real estate sector appears to be more rewarding and beneficial, if well planned.

Portugal's appeal as a location to live and work, combined with banks' increased willingness to finance houses, especially in areas where values have increased, might keep prices rising. Real estate is still a successful investment field for those pursuing a Portugal Residency by Investment, even though profit margins are now lower.

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Touristic hotspot?

Portugal's rich and unique history has made it one of Europe's top tourism hotspots. The country attracted approximately 17 million tourists in 2019, and remains one of the most prevalent touristic countries post-pandemic. Tourism revenues reached 24 billion dollars in 2019. This sector has garnered interest from businessmen wishing to invest in Portugal. Investments in developing hotels, lodges, and other tourism-related initiatives such as dine-in restaurants will continue to be lucrative for individuals seeking Portugal Residency by Investment.?

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Renewable Energies: All the fashion

The necessity to create alternatives to polluting energy sources such as oil has fueled expansion in the renewable energy market. Furthermore, the country has ideal weather conditions for developing projects, such as wind power to sun or waves. Therefore, the energy industry has proven to be one of the most appealing to those seeking to have a Portugal Residency by Investment. Investors can produce energy and sell it to the grid or can work in solar or photovoltaic panels. Although, the return on investment will take time, but it will be positive.

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Farming: Hidden treasure?

Investing in agricultural projects is another pillar of Portugal's new wave of investment, that’s why an increasing number of people are investing in farming. Wine and olive oil are two of Portugal's most popular sub-sectors that are thriving in the country. These initiatives can also benefit from a range of European Union support programs, namely the Recovery and Resilience Plan.

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Technology gaining strong momentum?

Over the last few years, the IT sector has also experienced rapid expansion. The COVID-19 pandemic was an accelerator for technological growth and implementation. Many companies have moved to Portugal, leveraging from the country's expertise and the success gained in this sector. According to the United Nations Conference on Trade and Development, Portugal is ranked 32nd out of 158 nations in the Readiness for Frontier Technologies Index. Portugal supports technological progress by investing in infrastructure, human resources, and technology. This is an additional reason for those looking to acquire Portugal’s Golden Visa by Investment.

According to the EY Attractiveness Survey 2021, Portugal joined the top 10 nations for foreign direct investment (FDI) with 154 projects recorded in 2020. Portugal's present and future are represented by manufacturing, R&D, and shared service centers (SSC). The R&D initiatives that multinational investors appear to have planned seem to be heavily influenced by Portugal's image as a hub of technical innovation on a global scale.

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Robust Passport

Portugal’s passport is ranked as one of the strongest, where it allows its holders to enter without a visa to over 170 countries. A Portugal Golden Visa by investment allows investors to move freely, and create their enterprises in 25 other European nations because it is a member of the Schengen region.

When approved for Portugal’s Residency by Investment program, investors can benefit from a state-funded healthcare system, as well as access to European colleges and job markets. Applying for Portugal’s Golden Visa by Investment opens up a world of opportunity for wealthy individuals who are currently hampered by a weak passport or political instability in their home countries, starting from business to long-term plans for retirement, education, healthcare services, and career.

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Tax Breaks for New Residents

The 'non-habitual residents' (NHR) scheme provides individuals who obtain Portugal Residency by Investment with unique tax benefits for their first ten years in the nation. It also provides a lower income tax rate of 20% if they work in a 'high value activity and permits them to receive certain overseas income tax-free.

How to obtain Portugal’s Golden Visa?

To wrap up, Portugal has evolved as an ideal business hub for investors from all across the globe, as its economy is shifting to be confident and ever-growing. Individuals who are interested in obtaining a Portugal Golden visa by Investment, are required to invest in real estate in selected areas. The residency permit holder can apply for Portugal’s citizenship after 5 years of legal residency. Dependent children and parents can be included in the same application. Applicants receive their Portugal Golden Visas within 8 months of making an investment and applying.

For more information required about obtaining Portugal’s Golden Visa by Investment, and the steps required, please visit this page.