Trade between Spain and Portugal unaffected by political instability in Madrid
Despite political and economic instability in Spain, with three general elections in three years, bi-lateral trade relations between the two countries continue to be strong.
The main indicators that measure the commercial relationship between Portugal and its largest European market currently reveal a trade stability that seems immune to the current crises hitting Portugal’s larger neighbour.
“The effects of the Spanish elections are difficult to measure, but I am sure that whatever the results of the elections — a coalition government seems likely — it will not affects trade between the two markets which is very strong” says Enrique Santos, President of the Spanish-Portuguese Chamber of Commerce (CCILE) in an interview with online business daily ECO.
The growth trends which commercial indicators between Portugal and Spain revealed before the crisis have remained (stable) since the economic crisis and in the years that have followed and just by looking at the numbers you can hardly tell that Spain has even been suffering a political crisis since the end of 2015,” he says.
And if there is one indicator that stands out since 2015 these would probably have more to do with strong economic policies pursued by the Portuguese government than political uncertainties within the Spanish government.
Historically, there is a trade imbalance in favour of Spanish exports to Portugal. Portuguese exports suffered a considerable deterioration in 2017 and 2018 – the trade imbalance increased from €20.3Bn to €23.5Bn in 2018 which resulted in a disparity which went from €7.5Bn in 2016 to €8.8 Bn in 2018.
Overall, trade between the two markets is worth €32Bn in transacted goods and services (2018) which, despite the imbalance against Portugal, has grown year-on-year, proof of a consolidated relationship and an important interdependence in sectors such as the automotive, machinery, mechanics, plastics and fuels sectors,” says Enrique Santos.
In fact, the total number of Portuguese companies trading in Spain has been increasing despite the political instability over the border. Portugal had 5,278 companies exporting to Spain in 2014 – a number which has increased since then at a sustainable rate.
“In 2015 there were 3.6% more Portuguese companies exporting across the border than in 2014. By 2016 that number had climbed by 2.56%, and in 2017 by 4.72%. At the end of this year the total number of Portuguese companies exporting to Spain stood at 5,874”, says Santos.
“Portugal will continue to be an important trading partner for Spain and if we study two episodes from the recent past, such as the economic crisis which began in 2007 or the Catalonia crisis more recently, it can be seen that bi-lateral trade between the two nations have remained stable with an upward trajectory of growth,” Santos concluded.