FATF status

Portugal is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Portugal was undertaken by the Financial Action Task Force (FATF) in 2017. According to that Evaluation, Portugal was deemed Compliant for 12 and Largely Compliant for 22 of the FATF 40 Recommendations. It was deemed Highly effective for 0 and Substantially Effective for 6 of the Effectiveness & Technical Compliance ratings.

Portugal has made progress in combating corruption, with a January 2024 report indicating that only three out of fifteen anti-corruption recommendations from GRECO were satisfactorily implemented by the end of 2023. Despite this, U.S. firms do not view corruption as a significant barrier to investment, and the government has enacted various laws to enhance transparency and accountability, including a national anti-corruption strategy approved in December 2021. However, corruption remains a concern, particularly at the municipal level, where issues in urban planning and public procurement persist.

Portugal's economy experienced a robust GDP growth of 6.7% in 2022, followed by a growth rate of 2.3% in 2023, primarily driven by tourism and real estate sectors. The unemployment rate stood at 6.5% in 2023, slightly up from the previous year's low, while inflation was recorded at 4.3%. The government has made significant strides in reducing fiscal debt, achieving a sovereign debt level of 99% of GDP in 2023.

Portugal maintains an open-door policy towards foreign direct investment (FDI), treating foreign and domestic investors equally under non-discrimination principles. The government requires prior approval for investments in sensitive sectors for national security, but generally does not impose restrictions on foreign ownership or profit repatriation. In 2023, U.S. FDI inflows to Portugal quadrupled to €2.1 billion, highlighting the country's appeal to foreign investors, particularly in technology and renewable energy sectors.