Tag Archive for: GDP

Economy

‘Look for the persons who benefit and you will know’ – Lenin

The four biggest economies in the Eurozone – Germany, France, Italy, and Spain – together represent two-thirds of the European Gross Domestic Product (GDP), an important indicator of economic health.

The Portuguese economy is relatively small – representing 1.5% of the European GDP – and surpassed by countries with less population like the Czech Republic, Sweden, Denmark, Austria, and Ireland. 

The International Monetary Fund (IMF) forecasts a growth in the Portuguese economy of 2.6% this year and stabilization at around 2% in the medium term, with a fall in inflation to 5.6%. Earlier this year, the IMF had predicted a growth of just 1%. The above-expected growth is mainly attributed to an increase in tourism – after the coronavirus pandemic – and the export of goods.

According to the Portuguese Government, export is increasing and represents 40% of its GDP. Cork is the most exported product – sold to 133 countries – reaching a record of 1.2 billion euros in 2021.

The quality newspaper Expresso disclosed that wine exportations last year  – especially to the US, the UK, Canada, and Brazil – amounted to almost 1 billion euros. Portuguese wine is popular in every continent especially because of its original products like Green Wine, Port, and Madeira Wine.

Moreover, the country is the 4th biggest exporter of olive oil in the world and exports plenty of shoes, clothing, vegetables, and bicycles.

Last year a downward trend in debt and deficit was common in the Eurozone where public debt stood at 92% of GPD – four percentage points lower than at the end of 2021.Eurostat revealed that Portugal was able to register an even more pronounced reduction (eleven percentage points) in 2022, putting its actual public debt at 114%.

Even so, the Portuguese debt remains one of the highest of the 27 member states, just behind Greece and Italy.

The financial rating agency Fitch recently reaffirmed the assessment of the Portuguese debt at BBB+.
The robust reduction in public debt was also highlighted by the US agency, which forecasts that the Portuguese debt will further decrease to 105% next year. 

Even though Portugal’s economy has grown above the EU average this year, it still has one of the lowest growth rates in the world.

According to the newspaper Expresso, the GDP in the country has grown at a mean rate of only 1.2% per year since 1999 and is unlikely to change its course by 2028.


Enjoy the week            Aproveite a semana                                     (pic Público/Sapo)

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Poor


‘Portugal is becoming a country of minimum wages’

Joana Gonçalves is 47 years old and works for 20 years as an operating assistant at the same hospital. Last year she earned 665 euros per month, just as much as the minimum wage. Deducting € 103,08 for Social Security and adding a food allowance of € 81.09, her net salary was 643,01 euros. Fifteen years ago Ana earned € 580, while the minimum wage was 430 euros. In the meantime, salaries have been frozen as a result of austerity measures while minimum wages increased. Her daughter Maria had to drop out of university because Joana had no longer money to support her. Maria is now cleaning in a supermarket.


Minimum wages in the EU member states range from € 332 per month in Bulgaria to  € 2257 euros in Luxembourg. Since the Socialist Government of António Costa seized power in 2015, the minimum wage has increased by 40% to € 705 this year. Average salaries, however, have only increased 10% during the same period.




‘This neglect to update the salaries of more qualified workers has caused strong distortions in the country. Nowadays more and more workers receive a salary very close to the minimum wage’, says economist Eugénio Rosa, advisor to the Confederation of Portuguese Workers (CGTP). ‘Portugal is transforming into a country of minimum wages’.


The IEFP (Institute of Employment and Professional Training) proves the point. Of the 150 job vacancies on its site – aimed at civil engineers, electro technicians, mechanics, etc – the majority of salaries offered vary between €750 and €1000.


‘But it’s anything but easy to get out of this trap’, explains Fernando Alexandre, professor at the School of Economics from the University of Minho in Braga.


‘Not only is our minimum wage one of the lowest in Europe, our country was last year one of the EU countries with the lowest Gross Domestic Product (GDP) per capita, the country’s wealth-producing capacity per worker. Only Bulgaria was doing worse’.  


To make matters worse, the pandemic has condemned hundreds of thousands of Portuguese into poverty. These ‘new poor’ are almost all people who already earned a minimum wage – or even less – before the pandemic. Workers in the tourism sector, restaurants, and hospitality were most hit by the restrictions to contain the pandemic. Women – especially the elderly – are among the most affected.


The bottom line is that today one in five Portuguese is at risk of poverty. In children, the risk is even greater (22%). Food banks have become indispensable. There are more than 2000 institutions – parishes and councils identifying the populations’ needs – which have partnerships with the 21 food banks that are feeding approximately 450.000 persons (4% of the population).



Enjoy your week                   Aproveite a semana               (pic Público/Sapo)





















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Holidays

Happiness has many faces, traveling is probably one of them — José Saramago


Tourism is injecting 30 million euros per day into the local economy, whereas the number of hotels in Lisbon has doubled over the last 10 years.

Tourism has not only become one of the most important pillars of the Portuguese gross domestic product (GDP), it also diminished regional asymmetries and unemployment, while increasing the national self-esteem.

Discussing its massive expansion in public, however, has become a new taboo. “The ones who are concerned about the gentrification of the historic city centres, want to destroy the economy. Those who ask for more regulation by government are unrealistic and whoever talks about the negative impact mass tourism has on other European cities, is said to be a manipulator.”

Fact remains that Lisbon and Porto have twice the number of tourists per resident than Barcelona or London and that there exists a lot of discontent about holiday rental services – such as Airbnb – and exorbitant rising rents for local tenants.

Although international tourism is more and more becoming an all year long issue, most tourists prefer to spend their summer holidays in August. They mainly come from the UK and Germany or –by car – from Spain and France,  residing in apartments and small villages, either on the mainland or on the islands of Madeira and the Azores.

The vast majority of the Portuguese celebrate the long school holidays in their own country. Also in August, just like the tourists from abroad. Traveling by car to the northern and central countryside, and staying with the family in a hotel is their favourite way of spending leisure time. Residents of Lisbon love to visit local beaches around the capital or savour free time in their summer cottages in the sunny Algarve.

Only 10% of the Portuguese travel abroad, mostly to nearby European destinations, although Cabo Verde, Morocco, and Turkey are gaining ground. When traveling – both inside and outside the country – the Portuguese spend about 40% less money, compared to their fellow Europeans


BOM FIM DE SEMANA           HAVE A GREAT WEEKEND     (pics Sapo/Publico)

 

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