Portugal's economic transformation earns another vote of confidence

Portugal has received another major vote of confidence from international markets after Canadian credit ratings agency DBRS Morningstar upgraded the country’s outlook from “stable” to “positive”.

The revision represents Portugal’s third positive ratings outlook upgrade in less than six months, following similar moves by Fitch Ratings and S&P Global Ratings. Together, the upgrades underline growing confidence in Portugal’s economic strength and long-term investment appeal.

At a time when many European economies continue to face economic and geopolitical pressures, Portugal has continued to improve its fiscal position while sustaining stable growth.

DBRS pointed to the country’s ongoing success in lowering public debt, highlighting that Portugal’s debt-to-GDP ratio dropped below 90% in 2025 for the first time since 2009 — a benchmark regarded as a major milestone for the national economy.

The agency also referenced disciplined fiscal policies and resilient economic performance as central reasons behind the improved outlook.

Portugal closed 2025 with a budget surplus of 0.7%, ahead of forecasts, while economic growth reached close to 2%. The country also earned recognition from The Economist, which named Portugal its “Economy of the Year” at the end of 2025.

Finance minister Joaquim Miranda Sarmento said the recognition reflected the combined efforts of families, businesses and government to build “a more resilient and less indebted economy”.

Portugal’s sovereign credit rating remains at “A (high)”, with all major ratings agencies now placing the country securely within the A category — one of the strongest positions Portugal has achieved in recent decades.

The latest outlook upgrades are expected to further enhance Portugal’s reputation among international investors, particularly as many continue to seek politically stable and economically resilient countries with long-term growth prospects.

Improving public finances, a robust tourism industry, rising international business activity and sustained foreign direct investment have all contributed to Portugal becoming one of Europe’s leading destinations for global capital.

The improved outlooks are also likely to support lower borrowing costs, increase investor confidence and strengthen Portugal’s standing as a secure and strategic base for international investment.

Portugal Pathways chairman and founder, Paul Stannard, said: “This latest economic rating upgrade comes amid high levels of interest in Portugal from international investors across sectors including real estate, technology, renewable energy, tourism, and, of course, the Golden Visa residency-by-investment programme.

“We’re seeing more high-net-worth individuals and investors looking to Portugal as an opportunity to diversify their portfolios and secure a real ‘plan B’ amid global uncertainty.”

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