Overview of Portugal - Opportunities and Economic Environment Belfast, 10 th September 2010

1. Think Global, Think Portugal A country of opportunities Overview of Portugal - Opportunities and Economic Environment Belfast, 10th September 2010

2. Think Global, think Portugal • “Portugal is not in same boat with Greece. This is very visible when we look at the facts and figures. Portugal is not Greece", Jean-Claude Trichet - President of the European Central Bank (ECB) • “Comparisons between Greece on the one hand and Spain and Portugal do not reflect reality. Economies of Spain and Portugal's are not comparable to that of Greece”, Angel Gurria - Secretary General of the Organization for Economic Cooperation and Development. • “The financial situation in Spain and Portugal is not comparable to that in Greece. We don't see the cases of Portugal and Spain as comparable to Greece", German Finance Ministry spokesman. • “Portugal is in a totally different situation than Greece. Greece is much more oriented to the Eastern part of Europe, to the Balkans, Portugal is in the crossroads of the southern emerging countries”, Ricardo Salgado - Chairman of Espirito Santo Financial Group [ESFG] and director at NYSE Euronext. According to the IMF, the Portuguese banking system has weathered the global financial crisis relatively well, reflecting pre-existing strengths. Portuguese banks’ borrowings from the Central Bank amount to less than 2% of banks’ assets. This is below the levels observed in France, Spain, Germany and Greece.

3. Think Global, think Portugal Country’s strenghts (in numbers) • 9.4% of GDP in 2009 (compared with 12.7% in Greece) • 85% of GDP 2010 (compared with 124% in Greece) • Tough fiscal measures: Between 2005 and 2007, Portugal cut its budget deficit in half, from 6.1% of GDP to 2.6%. • Portugal had lowered the deficit to 2.8% of GDP, in an environment of moderate growth. • A four-year austerity programme to chop the budget deficit again, this time to 2.8% of GDP in 2013, has been adopted. • Age-related public spending will rise by only 2.9% of GDP in Portugal over the next 50 years (compared with a euro-area average of 5.1% and a startling 16% in Greece) • In the EU context, Portugal is well placed in what concerns public debt affordability and sustainability. • Activity indicators are suggesting an exports-based recovery in 2010-2011. GDP could rise close to 0.6% in 2010 (after -2.7% in 2009).

4. Think Global, think Portugal Core competitive advantages: Modern country in transition from low-cost manufacturing to knowledge-based industries. In five years, Portugal has become a European leader in renewable energy. It has also cut civil-service jobs from 747,000 to 675,000. It sends some 35% of its young people to university. It is investing over 1.5% of GDP in research, much more than Spain. At the same time, however, Portugal is losing some of its EU structural funds to the club’s newer, poorer members from Eastern Europe. Higher growth in the future come from improved confidence from fiscal consolidation; An expansion of the relevant market of the economy, mainly to Africa and Latin America, taking advantage of historical and cultural ties, as well as of geographic proximity (and acting as a bridge to these emerging economies);

5. Index • Access to Markets • Great and Reliable Infrastructures • Technology and Innovation • Human Resources Performance • Attractive Business Environment • Recent FDI Track Record • Government Support • Aicep Portugal Global

6. Stockholm Berlin London Paris Rome Madrid Lisbon 4h 2h 1h 3h A country of opportunities Access to Markets THINK Strategic location. Global partners. Strategic Location and Global Experience Free flow of capital and goods within the European Union As one of the charter members of the European Union (EU), it is fully integrated with the EU and uses the Euro currency. Portugal is an open door to the Portuguese speaking countries, which offer a market of 250 Million people. East Side Opportunities We are a privileged entry point for the EU as well as strategic platform into the African markets and others. West Side Opportunities We provide a transatlantic bridge to the Americas. We have an open door to the Atlantic ocean being a strategic point for important international traffic canals. As with all EU countries, Portugal’s borders and ports are completely open to the free flow of trade with other EU member countries. Portugal has a politically stable environment with a democratically elected parliamentary government and is welcoming foreign business and investment. (Distance by air)

7.     A country of opportunities Great and Reliable Infrastructures CHOOSE Great infrastructures. Innovative country. Skilled and talented people. Road System Airport Infrastructures 4 International airports in the mainland (one under certification) with regular daily passenger flights to major European cities; New projects in place, namely the new airport at Lisbon and the TGV lines linking Portugal with Spain. One of the most developed roadway systems in Europe; Excellent international and national accessibility. Porto Lisbon Beja Faro Within a sample of 150 countries, Portugal is the 28th in the Logistic Performance ranking presented by World Economic Forum 2008 • Paris:1.800 Km (time: 17h00) • Frankfurt:2.400 Km (time: 23h00) • Moscow:4.800 Km (time: 51h00) • Madrid:627 Km (time: 06h00) • Valencia:981 Km (time: 09h00)

8. Leixões Bobadela A country of opportunities Great and Reliable Infrastructures CHOOSE Great infrastructures. Innovative country. Skilled and talented people. Railway System Seaports 4 international rail lines exiting Portugal; Logistic chain, with rail-road-ports terminals spread throughout the country; Products transported by train include containers, construction materials, timber, agro-industrial, coal, cars and vans, fuel, and chemicals; Two main containers terminals, one at Bobadela and the other at Leixões. There are 9 sea ports in the mainland, all receiving international traffic; The Sines port receives 38% of all cargo ships arriving and departing Portugal, followed by Leixões (20%) and Lisbon (17%); Regular cargo lines, linking Portugal to North, Central and South America, Asia, Africa, Europe and Middle East.

9. A country of opportunities Technology and Innovation CHOOSE Great infrastructures. Innovative country. Skilled and talented people. Knowledge and Innovation Technological Infrastructures Digital Terrestrial Television It is in the implementation phase and it is expected full country-coverage by the end of 2010. Technological Plan, a central pillar of Government policy, is designed to lift public and private spending on research, expand training in advanced technologies and increase the scientific output of universities. The mobilization program revolves around three key words: knowledge, technology and innovation. Broadband Penetration According to OECD broadband portal (June 2010), Portugal is TOP 10 in broadband penetration (net increase per 100 inhabitants), among 27 EU countries. "... (the Portuguese Technological Plan) is probably the best I have ever seen worldwide" Craig Barrett, Chairman of the Board of Intel Corporation - August, 1st, 2008 Next Generation Network Recently announced by the Government, NGN will be deployed over the country and the goal is to have 1Million users by 2010 as well as schools and public institutions. It is already boosting the telecommunications services and the fiber optic industry in Portugal. The main advantage is the People. The Portuguese People are available, flexible, dedicated, skilful and always ready for a challenge. Our philosophy says it all: “nothing shared, nothing gained” Siemens Portugal Labour productivity in Portugal has been increasing over the past years, so nowadays productivity standards are very good. When comparing with countries known for high levels of productivity, such as Germany and France, I think Portugal has reached their levels. Microsoft Portugal

10. A country of oportunities Technology and Innovation Energy Efficiency The Portuguese Government and the Alliance Renault-Nissan announced a partnership to promote the zero-emissions mobility in the country. Portugal will be one of the 1st world markets to introduce Renault-Nissan electric vehicle models, in 2011. An integrated network between several points existing in national territory boosted by the management entity Mobi.E which shall allow the supply of electric vehicles by way of a charging card. Supply SystemHence, the Electric Mobility System has come about in Portugal.  An integrated network between several points existing in national territory boosted by the management entity Mobi.E which shall allow the supply of electric vehicles by way of a charging card.

11. A country of opportunities Human Resources Performance CHOOSE Great infrastructures. Innovative country. Skilled and talented people. People of Skills Education Many Universities in Portugal now offer degrees in science and engineering, management and technological areas that teach the skills needed to succeed in the industry. Degrees, Masters and PhDs available in areas such as: Computer Science, Design, Engineering, Health and Pharmaceutical, Food and Beverage, Environment, Energy and Forest and Textile. Despite the raise of skills of the work force, necessary to shift towards higher value-added and more competitive products, the relation skills-wages continue to be one of the best in Europe. In a modern world, in which changing is a constant, the market conditions such as flexibility and adaptability of employees are crucial, determining a great proportion of business attractiveness in a country. Portugal is in the TOP 10 of the EU in what concerns to flexibility and adaptability of employees. 2nd place for Labour Costs in EU 9th place for flexibility & adaptability in EU Portuguese Human Resources are a main competitive advantage for the development of high value-added activities. Source: Global Benchmark Report (2008)

12. A country of opportunities Human Resources Performance CHOOSE Great infrastructures. Innovative country. Skilled and talented people. Did you know that… Multilingual Capabilities Portugal is TOP 4 in the Eurozone in the number of science PhD’s per 1,000 inhabitants between the age of 25 and 34, according to Global Benchmark Report, 2010? At least three English is second language from 1stgrade? According to Eurostat,the average growth rate of hourly labor costs (2003-2007) in Portugal is + 4,21% and the same rate in Central and Eastern European countries is +11,65%? A considerable percentage of Portuguese are able to hold a conversation in one foreign language besides their mother language. English, French and Spanish are the most known languages. PORTUGAL 2nd Best EU performance Source: Eurobarometer “EUROPEANS AND THEIR LANGUAGES” 2006 Growth rate per dimension Source: European Innovation Scoreboard 2008 – January 2010

13. A country of opportunities Attractive Business Environment FIND Your partner. Global brands. Innovative products. Global solutions. Entrepreneurship Transatlantic Bridge towards Education and R&D Entrepreneurial activity, 2009 Five programmes focused on specialised areas are being developed with four U.S. Universities: MIT, Carnegie Mellon, the University of Texas at Austin, Harvard Medical School and Germany’s Fraunhofer Organization. These programs include Masters, PhDs, post-graduate studies, MBAs and R&D. #4 Portugal is part of the countries with the greatest share of new entrepreneurs. Portugal is in the top 5 of Entrepreneurial activity, above the Euro zone and OECD average. Source: Global Benchmark Report (2010)

14. A country of opportunities Attractive Business Environment FIND Your partner. Global brands. Innovative products. Global solutions. Competitive Electricity Costs Ease of Setting up a Business Electricity costs for industrial clients, 2008 #3 #4 Portugal is one of the TOP 3 countries with fewer legislative barriers for entrepreneurial activities When deciding for an investment location, the cost of electricity is an important parameter and Portugal offers a competitive advantage in this area. Source: Global Benchmark Report (2010)

15. A country of opportunities Quality of Life ENJOY Quality of life. Hospitality. Beautiful landscapes. Culture heritage. SocialClimate Portugal as a Hotspot Portugal is the 13th most peaceful country in the World, among 144 Countries ranking in The Global Peace Index 2010, the first study to rank countries around the world according to their peacefulness. Portugal’s score went up from 14th place in 2009 to 13th in 2010, ahead of Germany, Belgium or Switzerland. Factors examined by the authors include levels of violence and organized crime within the country and military expenditure. • Mild climate • Unique luminosity • Hospitable people • Landscapes • Original gastronomy • Social stability • Entrepreneurship • Simplification of bureaucracy • Security Source: Global Peace Index 2010, Economist Intelligence Unit (Nations considered the most peaceful have lower index scores) Source: Lisbon was awarded “Best Destination 2010”, European Consumers Award , 2010

16. A country of opportunities Recent FDI Track Record DISCOVER Leading companies choose Portugal. Why? € 250 million investment by Nissan Europe for the construction of a lithium-ion battery factory for electric cars in Portugal. This project is scheduled to start in 2012 and will create 200 direct jobs. Announced the construction of two factories in Évora: one of the factories will produce metallic structures and the other composite materials, used for the construction of airplanes. The project is on the set up phase and will create 570 direct jobs. Investment of approximately 60 million € in the construction of a new plant, located at the Estarreja Chemical Complex. The plant is outfitted with state-of-the-art technology which will be used to convert natural gas into hydrogen and carbon monoxide in order to maximize production efficiency and minimize the environmental impact. Microsoft acquired the Portuguese company Mobicomp, market leader in mobile solutions. Windows mobile users around the world (that sold more than 20 million licenses) will benefit from a technology made in Portugal. Opening of the new Centre for Cisco Portugal operations in Lagoas Park-Lisbon. This facility also houses the “European Hercules Center”. This Centre provides qualified support to the European operations. It replaces and expands the services that were previously secured by the Dutch offices. It further reinforced its presence with the creation of 150 new positions for highly technological qualified people. The Swedish Group Swedwood (industrial branch of the IKEA Group) chose Portugal to install 3 factories for the production of wood furniture, including Kitchen fronts, MPS and board on frame products. Already in operations in Paços de Ferreira, the 130 M€ project already created 600 new jobs.

17. A country of opportunities Government Support Job Creation Incentives Financial and Tax Incentives (QREN) • Financial Incentives: • Interest free loan for up to 7 years, with 3 years grace period; • - Conversion to cash grant upon accomplishment of contractual goals, up to 75% of the financial incentive. • Employment of young looking for 1st job and short-term unemployed: • Exemption from social security contributions for a 3-year period, or; • Exemption from social security contributions for a 2-year period and direct grant of 2,500€. • 12-month Internships for graduates: • - 20% direct support to internship grant; • - 100% support of food and insurance expenses. • Tax Incentives: • Corporate tax credit of up to 20% of the investment; • Exemption of local taxes. A detailed incentives offer can be prepared for a specific investment and business plan.

18. Aicep Portugal Global TRUST Your reliable partner. • Public business entity, flexible, free of charges and streamlined services; • Dynamic approach focused on the client / investor; • Promoting a direct negotiation with companies, through which a tailored approach to incentives may be applied in order to define a global package that fully satisfies the investor's needs; • Single point of contact in all phases: pre-investment, incentives negotiation, settling in and after care.

19. Contacts and Further Information 1 http://www.portugalglobal.pt/EN/Pages/Home.aspxfor further info about the agency and the country: Investors’ channel 2 Near you: AICEP Portugal Global Av. 5 de Outubro, 101 Phone: +351 21 790 95 00Fax: +351 21 790 95 99

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