Real Estate Dominates Foreign Direct Investment in Portugal

In a recent report released by the Bank of Portugal, it was revealed that foreign direct investment (FDI) transactions in Portugal amounted to 6,800 million euros in 2023, marking a 16% decline compared to the previous year. Notably, a significant portion of these transactions was attributed to the real estate sector, which accounted for more than half of the total FDI.

According to the data, real estate investment surged to 3,900 million euros in 2023, representing a remarkable 22% increase compared to 2022. This surge propelled real estate FDI to its highest value since the initiation of the Banco de Portugal series in 2008, underscoring the sector’s robust performance and attractiveness to foreign investors.

The report also highlights the geographical distribution of FDI inflows into Portugal, with European countries emerging as the primary contributors. European nations accounted for the majority of FDI transactions, totaling 4,993 million euros, followed by Asian countries with investments amounting to 1,175 million euros.

This data sheds light on Portugal’s enduring appeal as an investment destination, particularly in the real estate sector, despite broader economic challenges and uncertainties. As the country continues to navigate evolving market dynamics, stakeholders are encouraged to capitalise on the opportunities presented by foreign investment to drive economic growth and prosperity.

The dominance of real estate in Portugal’s FDI landscape underscores the sector’s pivotal role in driving economic activity and fostering international partnerships. Moving forward, strategic initiatives aimed at enhancing the investment climate and promoting sectoral diversification will be essential to sustaining Portugal’s position as an attractive destination for foreign capital.