Portuguese economy falls 0.2%
A weakening exports performance has led to the Portuguese economy falling 0.2% in Q3 of 2023, a situation that was largely offset by strong internal demand.
According to the National Statistics Institute (INE), the Portuguese economy overall grew 1.9% like-for-like on the same period, but slowed in terms of the like-for-like progression of 2.6% — a percentage that had been revised upwards at the end of October.
In terms of volume, GDP registered a like-for-like variation of 1.9% in the third quarter of 2023, after having grown 2.6% in Q2. The positive contribution of net overseas demand on the like-for-like variation in GDP fell significantly in the third quarter, going from 1.7 percentage points in Q2 to 0.2 percentage points because of a sharp slowdown in exports of goods and services in volume.
The Portuguese exports economy had, until Q3 of 2023, risen consecutively since Q1 of 2021, but slowed sharply in Q3 of this year in line with the rest of Europe, and in particular Portugal’s main markets of France and Germany, which saw their economies all but flatline.
According to economists sounded out by the online news source ECO, a fall in exports had been anticipated, which in the case for goods, made worse by the stoppage at car plant Autoeuropa in September, and in services because of a slowdown in tourism.
Portugal’s economic performance was not worse thanks to a positive contribution from internal demand, which increased from 0.9% in Q2 to 1.7% in Q3, with investment playing an important role since it grew 4.5% after a like-for-like fall of-0.6% in Q2. Private consumption cooled 0.9% in Q3 after growing by 1.3% in Q2 of 2023.