Portuguese Investment Survey – July 2014

The July report of the Portuguese Investment Survey predicts a 2.4% nominal growth in business investment in 2014, a rise of 1.3 p.p. from the prediction obtained in the previous survey. The survey based on self-reported data also indicates that investment fell 4.0% in 2013, an upward adjustment of 4.3 pp from the previously reported value (-8.3%). Although its relative importance diminished, businesses cited expansion of productive capacity as the most frequent goal of investment, and investments were mainly self-financed (66.9% and 64.3% in 2013 and 2014 respectively). Firms reported that the main limitation in investing was a deterioration of sales prospects (51.8% in 2013 and 52.6% in 2014), followed by uncertainty about the profitability of potential investments (18.3% and 18.4%) and difficulty in obtaining bank credit (10.8% and 9.9%). Limitations to investing were felt most in the construction industry (72.4% firms reported limitations), water and sanitation industry (70.6%), and the mining industry (66.6%). In this context, higher purchasing power, orientation to profitable markets, and the development of capital markets may foster investment in Portugal.

The full report is available here (in Portuguese).