The Possible Outcomes of Brexit in Portugal
One of the most important decisions EU needs to make in the recent decades is about Brexit. Because of the conflicting decisions on the topic, Brexit looms over EU with its baggage of uncertainty. Next steps about Brexit affect United Kingdom and European Union all the same. However, Portugal also needs to carefully observe the proceedings. Here are the reasons why.
The rather obvious outcome of Brexit will be the financial changes between UK and EU countries. Whether the agreement goes through or falls through, it is certain that UK’s commercial partners will all be affected.
Possible effects of Brexit on Portugal:
Portuguese economy can lose up to 0,4%
Exportation can decrease up to 26%
Decrease in tourism
Impact in financing
Portugal’s economy relies rather heavily on tourism. It is not the only income source of the country, of course, but it is still a big source. A large percentage of Portugal’s tourists being British, the industry will definitely be affected by Brexit.
In the case where UK and EU do not come to an agreement, there might be several introductions for commercial barriers. In this scenario, Portugal might suffer some serious damage. UK is Portugal’s 4th biggest market for exportations. So, if a disagreement occurs between UK and EU, Portugal’s foreign trade might need to seek out new options.
Another concern for both countries is about people. UK is the main destination of Portuguese emigrants. Also, British community constitutes the third biggest European community in Portugal. Therefore, a potential problem affects both sides quite negatively.
At this point, it is predicted to have an increase in the number of sales of Portuguese real estate to British people. It has already been reported that Portugal enjoys an influx of British citizens.
However, it can be clearly seen that if the UK leaves EU, social interaction and circulation between Portugal and UK will be decreased.
The effects of Brexit on the Portuguese real estate market are not easy to pinpoint at the moment. British investors contribute a lot to the scene of Portugal real estate investment. Yet, is it going to continue? The cloud of uncertainty accompanying Brexit also shadows Portugal real estate market.
Different property developers have different ideas on the topic. For QP Savills in Quinta do Lago, 2017 and 2018 have been “among the best years ever”, with more Brits than ever deciding to invest in the Algarve. On the other hand, some developers get the feeling that British are “hanging on their money in fear of a no-deal”. Portugal Golden Visa Program plays a crucial role here. Offering Portugal residency in return of an investment, Portugal Golden Visa might be an effective tool for British in the future.