Following its successfully exit of the bailout of the International Monetary Fund (IMF), the European Union (EU) and the European Central Bank (ECB), Portugal is now catching the attention of foreign investors.

Portugal is no longer in the news for bad reasons. Still there are challenges ahead. Portugal needs to reduce historically high levels of Government debt and unemployment and bring its the budget deficit to below 3%.

After implementing a harsh economic program with little social unrest, Portugal is bringing down its chronic trade deficit and correcting some of its imbalances that have hindered its economic growth since the beginning of the millennium.

For international investors looking for a place to invest in Europe, Portugal offers several advantages, of which many investors are not aware.  Portugal is an ideal location for nearshoring industrial and services facilities because of its access to Europe's 500 million consumers' market and to the Portuguese-speaking world, which spreads across five continents: Europe, America, Africa, Asia and Oceania.

This paper provides an overview of the opportunities and challenges of doing business in Portugal and reviews the main aspects to be considered by foreign investors considering Portugal as a place to invest as regards the setting up of a business, hiring employees, taxation and government incentives.

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