The ranking keeps Portugal in the European Top 10 and reflects the country's attraction of 196 foreign investment projects. EY's research also found that investor confidence remains relatively strong, with 60% of surveyed business leaders planning to invest in or expand in Portugal over the next year.

The report places Portugal slightly above the European average for investment intentions and suggests businesses remain positive about the country's prospects. More than six in ten investors said they expect Portugal's attractiveness to improve over the next three years.

Software and IT services accounted for the largest share of foreign investment projects, while business services also continued to attract international companies. EY additionally highlighted the growing importance of Brazilian investment in Portugal.

The annual survey tracks foreign investment projects across Europe and gathers international executives' views on future investment plans. Despite increased competition for investment across the continent, Portugal has retained its place among Europe's most attractive destinations for international businesses.

According to the survey, Portugal attracted 196 foreign investment projects during the period under review, while investor confidence in the country's future remains strong. Around 60% of executives surveyed said they plan to establish or expand operations in Portugal over the coming year, placing the country slightly above the European average.

The report also points to positive long-term sentiment, with 61% of respondents expecting Portugal's attractiveness as an investment destination to improve over the next three years.

Portugal continues to perform strongly in job creation linked to foreign investment, reinforcing its position as a competitive location for international companies. EY notes that the country remains one of Europe's most significant investment destinations, given its size.

Software and IT services were the biggest recipients of foreign investment in Portugal, followed by business services. EY also highlighted the growing importance of Brazilian investment.

The survey suggests that Portugal remains on the radar of international companies despite a tougher investment environment across Europe.