Portugal, ever more “attractive” for French companies

Portugal goes to the polls this Sunday for legislative elections, one of the challenges of which will be to measure the breakthrough of the far right against the socialists and the center right who should remain in the lead. Very present in the country, French companies employ 60,000 people.

With more than 17 billion euros, France is the second largest foreign direct investor in Portugal. According to official figures, there are 60,000 French people living and working in Portugal. And if the country attracts around 750 subsidiaries of large French companies, it is because here, operating costs for companies are almost half as expensive as in France.

Several sectors of the economy are therefore growing, comments Laurent Marionnet, general director of the Luso-French Chamber of Commerce and Industry (CCILF):

“First tourism, obviously, which restarted the machine, after the financial crisis of 2008-2014. Today, tourism represents 20% of GDP, and there are always development projects. Then, you you also have traditional industry, which must not be forgotten, because it is what allows Portugal, in times of difficulty, to function. For several years now, we have been witnessing relocations of companies which had left to produce in Asia or North Africa.

The mayor of Lisbon recently symbolically inaugurated a “unicorn factory in the capital, named after these companies emerging from new technologies and valued at more than a billion dollars.

“We are not traditional start-ups, specifies Laurent Marionnet, Portugal is changing its face, and is becoming a country of innovation with the establishment of research and innovation centers, particularly in the automobile industry, where you have a lot of Germans, with a lot of jobs , and who open research laboratories, also with a link with universities, which is very easy, so it is a real asset.”

Projects in the pipeline

The country is also far ahead in Europe in green energies, and intends to maintain its advantage.

“There are periods, when there is a lot of wind or a lot of rain, when the country runs 100% on renewable energies, assures the Frenchman, and this has been happening for several days already. There are very significant wind, water and solar developments, and there are still many opportunities for French companies.”

In transport too, many projects are in the pipeline, such as the one won by Alstom, for the delivery of 117 trains to Portugal. All the trains will be assembled on site, in a factory built by the French group in the north of the country.

“Following Covid, there are recovery plans and European funds that have arrived, recalls the Frenchman. Portugal has received a lot of aid, and is taking advantage of it to update its infrastructure.

We must not forget that during this financial crisis, all public investments were blocked. We need to upgrade, and there are infrastructure projects, perhaps the construction of new lines, we hope to link the Portuguese network to the Spanish network, which would then make it possible to connect to Europe.”

According to the latest data from the Portuguese Central Bank, with more than 17 billion euros invested in 2022, France ranks as the second foreign investor in Portugal behind Spain.

The fact remains that if the cost of living is lower than in France, incomes are also lower: last year, the net Portuguese minimum wage was around 680 euros. The average salary is not much higher. The other side of the coin: a victim of its success, for several years, real estate prices have been soaring in Portugal.

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The Luso-French Chamber of Commerce and Industry (CCILF)

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