No other European country has undergone the same amount of dramatic changes which have been seen in Portugal since its 25th April Revolution.
The 1974 revolution ended almost 50 years of dictatorship and heralded in the dawn of a new country, keen to shed its colonial past. The country moved rapidly, from an almost third world status, to become a valued member of the modern European Union – this progress has, however come under enormous strain post the 2008 recession and Portugal has a hard road ahead to recover from its crippling systemic debts.
However, despite the changes that have undoubtedly taken place in the country, Portugal still suffers from a number of inherent difficulties which many observers, both internal and external, see as real brakes on the further development of the economy. The biggest problem faced by the country seems to be the continuing (and seemingly unchanging) burden of a vast and largely inefficient public sector. This public sector issue is often charged with not only producing ongoing Budget difficulties but also stifling private sector initiatives and vitality.
Private sector business is changing from a tradition of autocratic, family-run business conglomerates dominating the commercial landscape, to a much more varied landscape, where the influence of inward investment from major MNCs is starting to have a pronounced effect.
The Portuguese business scene is, therefore, in a state of flux with new ideas and business models competing with more traditional approaches and ideas. You really need to do some research and find out which type of business and people you are dealing with — new breed or old breed.
Written and Produced by Keith Warburton
Portugal’s economy was severely hit by the banking crisis and resulting recession. And, as a result the country has really struggled over the past decade. However, many commentators feel that the shockwaves resulting from the crisis will – given time – provide the impetus for Portugal to carry out several long-needed structural reforms. These reforms it is argued will provide Portugal with a much more solid base to build a strong sustainable economy for the long-term.
It was felt that, for many years, Portugal struggled with a bloated and inefficient public sector which was not only a drain on public finances but also served as a barrier to private investment and entrepreneurship. One of the conditions of the economic bail-out which Portugal was forced to seek following the crisis was that these structural imbalances would be tackled. This process was always going to be a challenge but there are signs of progress and the economy is definitely showing signs of a return to healthy growth.
Given where Portugal is on its path to economic growth there is a strong argument in favour of looking at doing business in Portugal now. It is usually good to enter a market at the early stages of an upward trajectory and Portugal certainly fits that criteria.
If you are considering doing business in Portugal or already have contacts in-country, you would be well-advised to find out a little more about the very distinct business culture you will encounter there. Portugal remains a relationship-based business culture but how do you best form and maintain those relationships? What do you need to know about the key drivers of Portuguese contacts to allow you to maximise any potential commercial opportunities?
This country profile provides an overview of some of the key aspects of Portuguese business culture in a concise, easy to follow-format. The document includes information on: