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Strengthening FDI and SME Linkages in Portugal

image of Strengthening FDI and SME Linkages in Portugal

This report assesses the enabling conditions for maximising the benefits of foreign direct investment (FDI) on SME productivity and innovation in Portugal. It looks at the quality of investment that Portugal attracts and the capacity of Portuguese SMEs to benefit from any knowledge and technology spillovers resulting from these investments. It studies the extent to which FDI-SME spillovers occur through value chain linkages, strategic partnerships, labour mobility, competition and imitation effects. The report provides an overview of Portuguese public institutions responsible for investment, SMEs, innovation and regional development policies, taking a close look at arrangements to ensure multi-level policy coordination, stakeholder consultation and evaluation of policy impacts. It then reviews the mix of government policies that are currently in place to support FDI-SME linkages and spillovers, noting areas for further policy reforms. The last chapter introduces a regional lens, focusing in particular on the regions of Norte and Alentejo. This report is part of a broader European Commission-OECD programme on strengthening FDI-SME linkages and serves as a pilot for future country assessments.

English

Enabling conditions for FDI spillovers on Portuguese SMEs

This chapter assesses key enabling conditions for FDI spillovers on SMEs in Portugal as described in the conceptual framework in Chapter 1. It first examines Portugal’s economic context and structure and then moves to key factors related to the potential for FDI spillovers (FDI trends, local embeddedness and capacity premia of foreign firms), SME absorptive capacities and Portugal’s economic geography. The chapter points to Portugal’s strengths, challenges and opportunities in these enabling conditions.

English

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