Billionaires put Portugal in 25th place in the world ranking of elite quality – Economy

Portugal occupies the 25th position in the Elite Quality Index (EQx) 2024, out of a total of 151 countries, having recovered five places compared to last year’s place in this international political economy ranking, which provides a unique perspective on the value creation, categorizing countries by the quality of their elites.

Portugal’s rise in EQx2024 is mainly due to the “power” sub-index, in which the country rose to 14th position, “largely reflecting the rise of two indicators of the disruptive innovation pillar with strong weight, namely financing of venture capital and the evolution of the number of billionaires”, explains the Faculty of Economics of the University of Porto (FEP), responsible for the study at national level, in a statement.

Óscar Afonso, director of the FEP, warns that those two indicators “can vary a lot in a relatively small economy like Portugal, with just a few billionaires and a small risk capital market”, while the “value” sub-index performed worse compared to the previous year, as a result of a fall in “economic value”, the area of ​​the index that has the greatest weight.

“Indicators related to production and work showed a worrying trend, showing a deterioration in several indicators, such as those relating to health costs, foreign direct investment and productivity”, adds Óscar Afonso, author of the study at national level , together with professor Cláudia Ribeiro and the Coordinator of the Office of Economic, Business and Public Policy Studies (G3E2P) at FEP, Nuno Torres.

This is the fifth edition of EQx, which presents itself as the main international political economy ranking, which measures how the elites’ wealth generation model is more or less extractive in terms of power (political and economic) and the its potential to translate into value (political and economic), penalizing or favoring, respectively, the progress of your country.

The preparation of EQx is the responsibility of the University of Saint Gallen, Switzerland, in collaboration with an international network of partners and academic institutions, including FEP, a partner in Portugal.

Housing and railways prevent Portugal from obtaining a better classification

In this latest EQx, which analyzed 151 countries and 146 indicators, it was possible to verify that the global quality index of the Portuguese elite “showed a significant improvement in 2024 (1.4 points compared to the previous year, to 58.4 points)”, being that, with regard to new indicators included in this edition, the classifications are below the national average: It occupies 55th place in the Housing Affordability Index, 41st place in Railway Network Density and 27th place in the Global Artificial Intelligence Index.

“While Portugal has made progress in mitigating the extractive potential of the elites, measured by the ‘power’ sub-index, this has not prevented a deterioration in terms of value generated in 2024, originating in economic value. Going further back, comparing with the first edition of the index (relative to the year 2020, in which most indicators were reported to 2019), it appears that the ‘power’ sub-index is above the pre-pandemic level, but the ‘value’ sub-index has not yet reached this level”, observes Óscar Afonso.

“This implies that the potential reduction in extraction by elites compared to what occurred before the pandemic has not yet translated into effective progress, for the benefit of society, in terms of value generated by elite business models”, concludes the director from FEP.

China and the United States rise, Germany maintains and India falls

In international terms, after the historic change of leader in the ranking, Singapore returned to first place, after being overtaken by Switzerland last year.

“Despite the political and economic differences between these two countries, both stand out for the sustainable creation of value, through the business models of their respective elites”, signals the FEP.

The Netherlands, Japan and New Zealand complete the top five in the ranking.

After falling from 8th to 9th place last year, the United Kingdom fell outside the top 10 this year, occupying 11th position, with the FEP highlighting that since Brexit the country has lost ground in global rankings and failed to attract foreign investment.

With Germany holding on to 8th position, the United States has seen an improvement, rising five places to 16th this year, while China has also moved up one place to 21st.

India fell four places, positioning itself this year in 63rd position.

EQx 2024 “reflects inflation, challenges to global trade and cooperation, and war in Europe and the Middle East”, revealing “a picture of global sustainable value creation and future growth prospects”.