PORTUGAL MARKET SIZE POPULATION TOTAL POPULATION: (2001) Spanish Institute of Foreign Trade-Country Cards 2003 POLICY

FRAMEWORK (May 2003) GEOGRAPHIC FEATURES 10,355,824 Population density: 112.3 inhabitants / km 2 (2001) FORM OF GOVERNMENT: Parliamentary Republic. HEAD OF STATE: O MIN LIM AI GROWTH RATE: (2001) 0.7% URBAN POPULATION: (2001) 35.0% DISTRIBUTION BY GENDER: (2001) PEOPLE MAIN CITIES: MALE: FEMALE: Age distribution: (2001) 48.3% 51.7% (Room 2001) The Portuguese Republic (92 082 km2) is located on the west coast of the Iberian Peninsula. Besides the continental territory includes the islands of the Azores (2,247 km2) and Madeira (794 km2) in the Atlantic Ocean. The relief Portuguese, with an average altitude of 240 m, is very similar to the adjacent areas of Spa in, although more uniform. Only 10% of the land over 700 m of altitude. The coun try's main mountain range is the Sierra de Estrela (1993 m). The main rivers are the middle and lower reaches of the Minho, Limia, Duero, Tagus and Guadiana, wh ich in these stages are most abundant in the Spanish tour, with almost all of th em navigable in its lower part. Portuguese rivers themselves are the most import ant Mondengo (234 km), the Sado (180 km) and Vouga (148 km), also partly navigab le. The Portuguese climate is characterized by the absence of temperature or hum idity extremes is never harsh winter, nor is excessive heat in summer. The north Atlantic climate is influenced by the Gulf Stream, the south has a Mediterranea n climate that favors the influx of tourism during the summer months. The temper atures are usually recorded in summer are more moderate than the Spanish, and ar e lower in 6 º C or 7 º C at equivalent latitudes. The average temperature in th e peninsular ranges between 11 º C in winter and 23 degrees C in summer. VIANA DO CASTELO

GUIMARAES BRAGA PORTO FEIRA DUERO The President of the Republic, elected every five years by universal suffrage an d re-elected only once. Since 1996, reelected in 2001, JORGE SAMPAIO. The next p residential elections will take place in 2006. Unicameral Parliament: Parliament consists of the Assembly of the Republic. It consists of 230 members, elected f or a maximum of four years. The electoral system is based on universal suffrage. The last legislative elections took place in March 2002. PRIME MINISTER: LISBON *: (Capital) 1,892,891 1,260,679 714,589 164,193 148,474 119,870 73,335 63,563 0-14: 15-64: 65 +: 16.0% 67.5% 16.5% OPORTO *: SETÚBAL **: Braga: Coimbra: LEIRIA: AVEIRO: SANTARÉM: A VO UG AVEIRO ATLANTIC OCEAN LEIRIA COIMBRA MO ND GO ON * Metropolitan Area. ** Setúbal Peninsula, Setúbal city, 2001: 13 937 hab. TAJO Since March 2002, José Manuel Durão Barroso, leader of the Social Democratic Par ty. GOVERNING PARTY: SANTARÉM J TA O SPAIN ELVAS INCOME Gross Domestic Product GDP by expenditure components: Current prices (EUR million, 2002) VALUE% LISBON SETÚBAL ALMADA SA D Évora GU AN AD IA

O SINES The Social Democratic Party (PSD, 105 deputies) in coalition with the Social Dem ocratic Centre-Popular Party (CDS-PP, 14 deputies). The main opposition parties are the Socialist Party (PS, 96 deputies), the Portuguese Communist Party (10 de puties), the Left Bloc (3 MPs) and the Green Party Os Verdes (2 members). Private consumption Public consumption Gross capital formation Exports of goods and services Imports of goods and services GDP at market prices 27527.6 78206.7 33353.0 38956.9 48704.4 129,339.8 60.5 21.3 25.8 30.1 -37.7 100.0 FARO FLORES TERCEIRA AZORES Faial S. MIGUEL Ponta Delgada SOCIAL INTEREST DATA RELIGION: (2001) (2002) HORTA ANGRA DO HEROISM STA. MARIA REAL GROWTH OF GDP: 1.6% 0.5% Strait of Gibraltar M A S ECO RRU MADEIRA MADEIRA FUNCHAL 0 RED RIVER RAIL ROAD MAIN BUSINESS AREAS 100 200 km 95.0% of the population is Catholic. OFFICIAL LANGUAGE: Portuguese. GDP PER CAPITA: Current prices (EUR 2001) 12 216 NATURE OF THE ECONOMY ECONOMIC ACTIVITY EMPLOYED POPULATION BY SECTOR: (2002) TRANSPORT INFRASTRUCTURE

GROSS VALUE ADDED BY BRANCH OF ACTIVITY Current prices (EUR million, 2002) VALUE% AGRICULTURE, FORESTRY AND FISHERIES: INDUSTRY AND CONSTRUCTION: SERVICES: UNEMPL OYMENT RATE: (2002) 12.4% 32.9% 54.7% 5.1% Agriculture, forestry and fishing industry and electricity VAB Construction Serv ices * * VAB + tax = 129,090.4 million. 116535.6 79891.4 24109.6 4083.8 8450.8 3.5 20.7 7.3 68.6 100.0 ROADS: In late 2001, the road network in the Portuguese mainland had a length of 12 010 km, of which 124% were major routes (IP), 50.1% to complementary pathway s (IC and national roads) and 37.5% on regional roads. Had approximately 2,600 k m of motorways. RAILWAYS: In late 2000, the railway network consisted of 3578 km , of which 667 km were narrow gauge. Between Lisbon and Oporto is a double line is electrified. In that year the rail freight moved 2.569 million tonne-km. Are being carried out relevant studies track leading to the launch of TGV linking Li sbon to Madrid. PORTS: The Portuguese mainland has 10 commercial ports (eight of them on the wes t coast and two south) and 171 moorings. Among the most important ports of the I berian Peninsula are those of Lisbon, Leixoes (Porto), Setúbal and Sines and the island of Funchal (Madeira Archipelago) and Ponta Delgada (Azores Archipelago). AIRPORTS: The main international airports are Portela (Lisbon), Francisco Sá Ca rneiro (Porto) and Faro (Algarve), followed by Santa Catarina (Madeira) and Sant a Maria (Azores). PRICES: (Average change 2002/2001) PA LES Í CHARACTER STICASDELOSPRINCI PRODUCTIVE SECTORS Despite the decline in the significance of agriculture in the Portuguese economy , in approaching the European average, the importance of agri-food sector in Por tugal is still one of the highest in the EU. The importance of agriculture in th e food industry is particularly important because the agricultural raw materials account for 40.0% and 80.0% of total intakes of food processing industries. Thi s dependency largely explains many of the problems of the sector. There are a nu mber of structural factors, that despite the high community support for the mode rnization of Portuguese agriculture, remain unresolved. These include the limita tion of arable land, inadequate irrigation, lack of skilled human resources and limited guidance for farmers to market. Among the strengths of the sector is to highlight the wide range of supply and the specificity of certain products and u nique characteristics of the regions in which they are produced. Quarrying activ ity in Portugal is mainly represented by the segments of industrial rock, metal ores and ornamental rocks. Of mines in operation are extracted, among others, ir on, manganese, tin, titanium, tungsten, copper, uranium, feldspar, quartz, talc and kaolin. Portugal is Europe's leading producer of copper, tin and tungsten, a nd one of the largest uranium, zinc, silver, gold and precious stones. However, the mining sector has often low rates of exploitation. The industrial sector con sists mainly of Portuguese SMEs: over 55% of Portuguese companies have fewer tha n five employees, and over 80% are under 10. Among the most important industries include food processing, textiles, footwear, wood, the furniture, the cork, pap er, printing and electrical equipment. While no one can speak of a structural ch

ange in the profile of Portuguese industry specialization, which still dominate traditional industries such as textiles and shoe manufacturing, development and consolidation of productive sectors such as ceramics, stones ornamental, electro nics, pharmaceuticals, automotive and the molds demonstrate the growing diversif ication and expansion of the country's industrial base. As regards the service s ector is still far away in terms of value creation and employment, relative impo rtance in other EU countries. The sub-sector support services business, concentr ated in Lisbon (54%) and Porto (18%) is the registered higher growth rates, foll owed by transport and communications. Trade is the most important subsector, it employs 12% of the population and generates 16% of the total gross value added. Finally, further activity is undoubtedly tourism. According to the WTO, Portugal is the EU country with the greatest potential for growth in this sector (4-5% a nnually). CONSUMER PRICES: (Change in December. 2002/dic. 2001) 3.6% CONSUMER PRICES: GOVERNMENT DEFICIT: (Est. 2002) 4.0% -2.6% GDP BUSINESS AND BANKING SERVICES MARKETING The metropolitan area of Lisbon is the biggest mall in the country and still has the largest concentration of services, with 29.6% of total business establishme nts. It is followed at some distance, Porto.€Portuguese distribution system has registered an intense process of modernization. As regards the wholesale distrib ution, mainly because of the emergence of the supermarket wholesalers and cash a nd carry, often the result of the transformation of traditional wholesalers. Lar ge retailers are characteristic of the commercial structure of the metropolitan areas of Lisbon and Porto, have been established in the rest of the country, coe xisting with regional retailers and wholesalers of average size. The structure o f retail trade is still characterized by the existence of a large number of smal l family businesses. Despite the proliferation of supermarkets over the past dec ade, Portugal remains the EU country with a lower number of hypermarkets in the total number of commercial establishments. The market share of supermarkets is n ow 36.2% and grows exponentially at the expense of traditional trade. Supermarke ts say 22.5% of sales. The implementation of large national and foreign chains a round the country is forcing small retailers to specialize to survive, while con tributing to homogenize consumption habits and purchasing of the population. BALANCE OF PAYMENTS (Millions of euros, 2002) BANKS The Bank of Portugal is the country's central bank. The main groups are the Port uguese bank Caixa Geral de Depósitos, Banco Comercial Português, Banco Espirito Santo, Banco Português de Investimento and Banif. As regards the Spanish bank, a re implanted in Portugal Banco Bilbao Vizcaya Argentaria, Banco Santander Centra l Hispano, Banco Popular, Caja Duero, Banco Sabadell, Caixa and Caixa Galicia Vi go. Services trade balance and income transfers capital Checking Account Direct Inve stment Portfolio Investment in Financial derivatives Other investment Reserve as sets Financial account errors and omissions 9440.0 3483.3 12832.2 1978.7 796.6 -91.1 -11.8 3218.0 5907.4 8814.2 1096.0 1352.

9 EXTERNAL DEBT (Millions of euros to end of period, 2002) Total external debt 7461 External debt / GDP 5.8% MARKET OPENNESS AND ACCESSIBILITY MARKET OPENING DEGREE (Goods, 2002) (goods, 2001) MARKET ACCESS 52.4% 31.4% TOTAL IMPORT / EXPORT GLOBAL TOTAL IMPORT / EXPORT GLOBAL 0.6% 0.4% FOREIGN TRADE (IMPORT Export.ar +.) / GDP Imports / GDP TRADE REGIME STRUCTURE OF FOREIGN TRADE GEOGRAPHICAL DISTRIBUTION OF THE PORTUGUESE FOREIGN TRADE (Percent structure, 2002) IMPORTS EU 76.9% JAPAN 28.1% SPAIN 1.8% EE. UU. REST EU 2.2% 3.2% SWEDEN 1.2% NETHERLAND S 3.0% BELGIUM 4.5% 15.0% GERMANY 10.2% ITALY FRANCE 6.5% UNITED KINGDOM 5.2% GE RMANY 18 REST OF WORLD 4% 20.2% 19.1% SPAIN EXPORTS EU REST WORLD SWITZERLAND 79.6% 11.4% 1.1% 2.1% EE ANGOLA. UU. 5.8% The introduction of goods originating from member countries of the EU or from th ird countries which are in free circulation in that Member State is not subject to quantitative restrictions or licenses. Nor is the issue of Portuguese goods t o the EU Member States. The import of agricultural products from third countries takes place in free trade arrangements, without national restrictions or of the Directive. Only requires the submission of an import license for free circulati on or certain products, according to Community legislation for the agricultural sector. Notwithstanding the general rule is still authorized Administrative imports of ivory and some cigars. The import of industrial produc ts from third countries are also made in free trade arrangements with some excep tions: the import of certain goods (textiles and clothing, footwear, porcelain a nd ceramics, and certain steel products) in certain countries is subject to rest rictions quantitative or surveillance measures, and other specific goods (drugs, explosives, firearms and ammunition) is subject to special licenses. REST EU 4.8% NETHERLANDS 3.8% BELGIUM 4.5% 12.6% FRANCE UNITED KINGDOM 10.5% 4.8% ITALY

PORTUGUESE FOREIGN TRADE BY PRODUCTS Tariff chapters of the EU's Combined Nomenclature (thousands of euros, 2002) VALUE% CHANGE 02/01 HISPANO-PORTUGUESE BILATERAL TRADE Tariff chapters of the EU's Combined Nomenclature (thousands of euros, 2002) VALUE% CHANGE 02/01 TARIFFS IMPORTS (CIF) 87. Motor vehicles, tractors 84. Nuclear reactors, boilers, machin ery 85. 27 Electrical machinery and apparatus.€Mineral fuels and oils 39. Plasti cs and articles thereof 30. Pharmaceuticals 72. Iron and steel 03. Fish, crustac eans and molluscs 48. Paper and cardboard 90. Optical instruments and apparatus Remaining Imports Exports (FOB) 87. Motor vehicles, tractors 85. 84 Electrical m achinery and apparatus. Nuclear reactors, boilers and machinery 61. Clothing, po int 64. Footwear 62. Clothing, not knitted 45. Cork and articles thereof 48. Pap er and cardboard 63. Other textile articles 39. Plastics and articles thereof ex ports Remaining 40,655,900 5,369,454 4,280,264 4,179,152 4,025,377 1,372,092 1,277,256 1,170,373 944,402 872,591 857,227 16,307,712 27,089,800 4,502,387 3,281,742 1,892,699 1,7 97,202 1,547,450 1,019. 139 888,843 852,415 808,962 691,257 9,807,704 -7.7 -9.4 -16.2 -8.3 -5.8 -0.4 13.5 -4.0 -7.5 -3.5 -5.9 -7.4 -0, 9 4.7 -5.4 8.1 -6.7 -8.6 -9.5 -0.5 6.7 -7.7 7.0 -1.7 SPANISH EXPORTS (FOB) 87. Motor vehicles, tractors 84. Nuclear reactors, boilers , machinery 85. 39 Electrical machinery and apparatus. Plastics and articles the reof 48. Paper and cardboard 03. Fish and crustaceans, molluscs 72. Iron and ste el 62. Clothing, not knitted 02. 73 Meat and edible offal. Articles of Iron or s teel exports Remaining SPANISH IMPORTS (CIF) 87. Motor vehicles, tractors 84. Nu clear reactors, boilers, machinery 85. 61 Electrical machinery and apparatus. Cl othing, point 39. Plastics and articles thereof 72. Iron and steel 48. Paper and cardboard 62. Clothing, not knitted 44. Wood 03. Fish and crustaceans, molluscs Remaining exports 12,917,735 1,668,576 1,356,660 952,970 569,509 503,109 409,806 378,864 331,407 3 25,612 317,998 6,103,224 5,337,798 545,450 356,026 355,542 312,271 285,703 262,7 80 256,075 234,719 217,065 194,850 2,317,317 -2.3 -1.9 -7.7 -5.6 -6.2 1.6 5.5 4.2 2.3 -13.4 -4.8 -0.9 9.9 75.7 -2.0 -2.1 12.8 12.3 21.4 2.6 8.5 4.0 4.1 4.8 The introduction of goods from other EU countries or communitaurised is exempt f rom payment of fees. The goods from third countries are subject to Community tar iff duties. MEMBERSHIP ORGANIZATIONS AND BUSINESS TRADE EUROPEAN UNION (EU) ECONOMIC AND MON ETARY UNION (EMU) EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT (EBRD) ORGANI ZATION FOR ECONOMIC COOPERATION AND DEVELOPMENT (OECD) COMMUNITY OF PORTUGUESE S PEAKING COUNTRIES (CPLP) World Bank ( BM) International Monetary Fund (IMF), WOR LD TRADE ORGANIZATION (WTO) UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT ( UNCTAD), African Development Bank (AfDB) INTER-AMERICAN DEVELOPMENT BANK (IDB) LEGAL FRAMEWORK FISCAL SYSTEM There are three rates of value added tax (VAT): normal 19.0%, 12.0% intermediate and low of 5.0%. In the autonomous regions of Azores and Madeira the rates are respectively 12.0%, 8.0% and 4.0%. The general rate of taxation of corporate inc ome tax (IRC) is 30.0%. Companies also have to face a shed (surcharge), municipa

l, up to a maximum of 10.0% share of the tax result, bringing the effective rate is 33.0% alradedor. In October 1993, the Portuguese Republic and the Kingdom of Spain signed an agreement to avoid double taxation and prevent fiscal evasion w ith respect to taxes on income, which was ratified on March 21, 1995. PRACTICAL INFORMATION CURRENCY The monetary unit of currency is the euro as in Spain. HEALTH PRECAUTIONS None. LOCAL TIME An hour less than in Spain all year round. POWER Voltage: 220 V single phase, 380 V three phase. Frequency: 50 Hz WORK SCHEDULE BANKS MONDAY TO FRIDAY 8:30 to 15:00. USEFUL ADDRESSES IN PORTUGAL PUBLIC ADMINISTRATION MONDAY TO FRIDAY 9:00 to 12:00 and from 14:00 to 17:00. USEFUL ADDRESSES IN SPAIN EMBASSY OF PORTUGAL IN MADRID CHANCELLOR Pinar, 1 28006 Madrid tel.: 91 782 4960 fax: 91 782 4972 EMBASSY OF SPAIN IN LISBON CHANCELLOR Rua do Salitre, 1 1269-052 Lisboa Tel.: 00 (351) 21-347 23 81/2/3 Fax : 00 (351) 21-347 23 84 ce: embesppt@correo.mae.es STANDARDIZATION AND CERTIFICATION OF PRODUCTS Some imported products, whatever their origin or source, must adhere to certain technical rules that lead to approval. In addition, the scope of mandatory stand ards is of course applicable EU law, common and equivalent to that applied in Sp ain. Moreover, as in all countries, there are technical requirements "volunteers " imposed by the market,€for which there are various certification systems. Thus , there is growing business requires more than fulfilling any of the standards I SO 9000 series. The Portuguese Instituto da Qualidade (IPQ) is the responsible b ody at national level for almost all activities of standardization, certificatio n and metrology, as well as credit to businesses. However, certain products are the responsibility of other agencies such as the Direcção Geral de Energia (elec trical and electronic products) and the Direcção Geral da Qualidade Controlo Fis calização and Feeding, responsible for the quality of foodstuffs. SHOPS IN GENERAL, Monday through Friday from 09:00 to 13:00 and 15:00 to 19:00, Saturd ay 9:00 to 13:00. Recently, large stores, which had OPENING SUNDAY and holidays from 10:00 to 22:00, can open only from 08:00 to 13:00 HOURS THESE DAYS. ECONOMIC AND TRADE OFFICE OF THE EMBASSY OF SPAIN IN LISBON PORTUGAL TRADE OFFICE IN MADRID (ICEP) Paseo de la Castellana, 141 28046 Madrid tel.: 91 567 2500 fax: 91 571 1424 VACATIONS AND HOLIDAYS Yearly holidays:

Are mandatory annual leave of 22 working days, excluding Saturdays, Sundays and public holidays. Campo Grande, 28 (2 AE) 1700-093 Lisboa tel.: 00 (351) 21-793 00 19 Fax: 00 (351 ) 21-796 69 95 ce: @ lisboa.ofcomes.mcx.es buzon.oficial HOLIDAYS: January 1 (New Year) 25 April (Freedom Day), May 1 (Labor Day), 10 June (Portuga l Day), June 13 (San Antonio, only in Lisbon), 24 June (San Juan, only in Oporto ), August 15 (Assumption), October 5 (Establishment of the Republic), November 1 (All Saints), 1 December (Independence Day), 8 December (Immaculate Conception) , December 25 (Christmas). Mobile Events: Good Friday and Corpus Christi. CONSULATE GENERAL OF SPAIN IN LISBON * Rua do Salitre, 3 1269-052 Lisbon tel.: 00 (351) 21-347 27 92 Fax: 00 (351) 21-3 47 86 23 * There is also a Consulate General of Spain in Porto. CHAMBER OF COMMERCE IN MADRID HISPANO-PORTUGUESE Zurbano, 67 28010 Madrid Tel.: 91 442 2300 Fax: 91 442 2290 SECRETARY OF STATE FOR TRADE AND TOURISM. MINISTRY OF ECONOMY Paseo de la Castellana, 162 28046 Madrid tel.: 91 349 3500 fax: 91 349 5242 cc: @ sectyp.sscc.mcx.es buzon.oficial PROTECTION OF PATENTS AND TRADEMARKS Portugal is part of the Paris Convention for the Protection of Industrial Proper ty and the Convention Establishing the World Intellectual Property Organization (WIPO). Is a signatory of the Munich Convention for European patents (European P atent Office) and the Cooperation Treaty (PCT). In specific question marks, is p art of the Madrid and has also concluded the Law Treaty (TLT) 1994. LINKS FROM SPAIN AIRWAY: Companies Iberia, Spanair, Tap and Portugalia offer frequent flights between Spa in and Portugal. CHAMBER OF COMMERCE AND INDUSTRY IN LISBON LUSO-SPANISH Av António Augusto de Aguiar, 9 1050-010 Lisboa tel.: 00 (351) 21-315 67 58 Fax: 00 (351) 21-352 63 33 By Sea: There are regular sea communications from the main Spanish ports to both the con tinental and insular Portugal. SPANISH INSTITUTE OF FOREIGN TRADE (ICEX) Paseo de la Castellana, 14-16 28046 Madrid tel.: 91 349 6100 fax: 91 431 6128 ww w.icex.es LAND: ROAD TRANSPORT All international conventions on road transport, CMR, TIR, ADR and ATP-are incor porated into domestic law. Spanish carriers wanting access to Portugal at the bo rder must present a Community license in force. Can freely enter the carriage of private and public services in light vehicles. The road link between Spain and Portugal is guaranteed for 20 roads, most of the m nationals, among which links the national highway N550, N620 and the main rout es NV Portuguese IP1, IP5 and IP7, respectively. There is also connection by mot

orway Galicia (Tuy-Valença do Minho), Badajoz (Madrid-Badajoz-Elvas-Lisbon) and Andalucia (Ayamonte-Vila Real de Santo Antonio). Rail traffic between Spain and Portugal are developed through four border crossings: Tuy-Valença, Sources Oñoro -Vilar Formoso, Valencia de Alcántara-Marvão and Badajoz-Elvas. SOURCES: Economic and Commercial Office Embassy of Spain in Lisbon, Databases IC EX, Bank of Spain, National Statistical Institute (Portugal), Banco de Portugal, WTO, WIPO, The Economist Intelligence Unit MAY, 2003 Legal Deposit: M-NIPO 00000-2002: 381-03-007-9 ISBN: 84-7811-483-1