Foreign Investment in Portugal | Opinion
At a time when the global height is considered, being a component all the investment is crucial, an acquired that is the foreign investment (FDI) and in international terms it is considered as, when it reaches at least 1% control of the voting rights .
Quality FDI, which is oriented towards the domestic market and export, rather than that directed towards resource growth, promotes the economic in both the short and long term. With FDI, new high-productivity technology is really efficient for the country, which resorts to qualified employment and which, at the same time, is better paid.
FDI also promotes exports and can help to decrease after an increase (we must not forget that eight consecutive years of surpluses in the trade balance, the result of a brutal drop in tourists due to the pandemic), it also promotes the arrival of tourists due to to the pandemic, technological companies with high quality, which in order to survive, improve capital, contribute to the increase in evolution, which in order to survive, improve human capital and technological diffusion.
At the limit, we can consider that FDI causes positive externalities in the domestic economy, through the spillover of effects and knowledge to domestic companies, such as the know how organizational structure and linkages between sectors.
In terms of FDI in 2020, the OECD countries (which we are part of) captured more than 39% of the world flow, with Portugal only benefiting from 0.73% of this world flow. Low light value. In relative terms in 2020, we captured 1.5% of GDP, a long time from the 5.1% of geography only in 2015 or even from the 4.8% of 2012. Despite the FDI and for reasons of the pandemic having dropped in several regions, in countries with which we compete for not so low FDI, such as Spain.
But what are the determinants that lead an investor to set his investment in a foreign country? This is not a single, simple answer, but there are several factors that can make a difference.
Foreign investors chose countries with strong political stability, fiscal stability, competitive level of taxes, transparency, quality and quantity of the country’s infrastructure, market size, skilled labor in quantity, developed financial markets, quality of national finances (variable very important in the selection process), quality measures and reduced measures of the judicial system, reduced levels of complexity, low importance in the selection process, intra-industry and existence of clusters industrial. Among other factors, it is on these determining factors that Portugal has to focus, in addition to being attentive to the investment intentions that are anticipated and future announcing the competition between countries for this investment is great. Countries that had characteristics manage to have an absorption capacity that allows for the full benefits of FDI.
Creating for the promotion of consumption is important, but first we must obtain the conditions to have quality investments. At a time when domestic investment is insufficient, foreign investment will be important for growth to help us get closer to the EU average. No country can live on consumption alone. First create an adequate level of wealth in the country and then consume goods and services using that wealth, not in credits and shopping ventures.
The author writes according to the new orthographic agreement