Portugal is a very attractive option for South African business people and executives who wish to work within the European Union (EU) easily and conveniently while also providing their families with a wonderful opportunity for a good education and lifestyle.
James Bowling, CEO of Monarch&Co International, a company that specialises in investor programmes for residence and citizenship in a number of territories around the world, points out that Portugal is ranked 49 out of 139 in the World Economic Forum Global Competitiveness Report 2012-2013, and is a country ripe with investment opportunities.
According to the World Bank, Portugal is the 43rd largest economy in the world, with one of the highest GDP growth rates over the last 40 years among the Organisation for Economic Co-operation and Development (OECD) countries. Bowling points out that it has also been the best performing economy in Europe for the past couple of quarters.
Since the dictatorship in Portugal ended, the country has leaned heavily to the left becoming socialist in mindset, applying an extensive welfare system including free state education, medical and guaranteed pension. Bowling says: “While the populace is incredibly well educated these days with two out of three graduates having degrees, there is not enough drive for people to take risks and run business – life is too comfortable with the welfare and state support. What Portugal really needs and is looking for are entrepreneurs and leaders of industry that can lead business and take advantage of the Portuguese business climate, thereby creating the necessary jobs and sharing leadership skill sets which are lacking.”
He points out that while Portugal felt the effects of the Euro-crisis, it undertook to participate in an Economic and Financial Support Programme between 2011 and 2013 which included an ambitious set of economic and financial adjustment measures designed to ensure balanced and sustained economic growth and to promote competitiveness and employment.
“Portugal’s reasons for getting into difficulties during the Euro-crisis are the same as other EU countries that suffered greatly: they took advantage of the cheap EU funding that become available through the union. But that is where the similarities end. Unlike other countries that ploughed the cheap funding into their economies, Portugal ploughed their funding into capital infrastructure,” says Bowling.
Bowling adds: “Visiting Portugal today you will notice the best road infrastructure in Europe, the best schools and education facilities, state-of-the-art government systems that allow for transfer of property in half an hour, police clearances in 30 seconds, and the list continues. All this development was completed before the crisis hit, however, it came too soon for Portugal to take advantage of the upgraded infrastructure and lure investment.”
Even though there is a forecast of moderate economic growth for Portugal in the medium term, it seems economic recovery and growth are expected to largely stem from increased foreign demand in the Euro Area, much like all EU countries. Bowling says: “The EU region needs to be viewed as a country, in essence, with the various member states being provinces of that country as that is how trade and business between the countries is viewed”.
“The Portuguese government recognises the value of foreign investment and sees it as an important engine of economic growth,” says Bowling. “Since 2012, the Portuguese government have been identifying and creating ways to generate capital and real estate investment, as well as opening the European door to potential investors.”
It was in October 2012 that they put the Golden Residence Permit or ARI legislation into play. The programme allows for immediate Residence that allows the investor to live and work in Portugal as well as travel visa free to all the 26 Schengen countries of Europe. In the sixth year the investor is entitled to apply for citizenship providing they have sustained the simple requirements of the ARI programme.
“The Portugal Residence Programme is attractive for investors who would like to enjoy the quality of life, great weather and safety that Portugal has to offer but also take advantage of being part of the European Union without being obligated to reside permanently in Portugal,” Bowling explains.
He says that the Golden Residence Permit for Investment is available to all foreign national investors who are not citizens of the EU. “This means that investors from all corners of the globe - regardless of which country they originate from - may qualify for this programme.”
To qualify, the investor will need to make an investment in Portugal through one of the following qualifying options:
- Capital investment with a minimum value of 1 000 000€ (one million Euros) in a Portuguese company.
- Establishing a Portuguese company that employs more than ten people.
- Acquisition of real estate with a minimum value of 500 000€ (five hundred thousand Euros)
“The criteria are simple and transparent, added to which, the Portuguese government is committed to supporting investment in the country to attract capital, promote job creation and increase investment in real estate. However, the most important motivation for this programme is the attraction of leaders of industry and entrepreneurs to the country. It’s believed - and has now been proved - that when an individual invests substantially in a country, their focus and interest in that country is increased significantly. What starts for the investor as merely complying with the ARI requirements for residence and citizenship often ends up with investors seeing the huge opportunity that exists in Portugal - with their brand new infrastructure and highly educated, hardworking labour force,” says Bowling. “This makes it a win-win scenario for South Africans seeking a rand hedge with international investment and expansion opportunities; and Portugal benefits from the human capital gained from investors stimulating the new business of tomorrow.”
Owing to the huge interest in the Golden Residence Permit for Investment and the government having more than achieved their objectives, this programme is expected to close mid this year, so interested persons and companies are urged to act now.
For more information contact James Bowling at Monarch & Co on 011 883 9018 or visit www.monarchandco.com