Portugal: GDP growth outstrips government estimate, grows 2.0% in 2019

The Portuguese economy grew 2.0% in 2019, one tenth more than what the Government estimated, according to the release of the Gross Domestic Product (GDP) figures made today by the Statistics Portugal (INE).

According to INE, in the fourth quarter of 2019 the national GDP grew 2.2% year-on-year (compared to the same period of 2018) and 0.6% quarter-on-quarter (compared to the third quarter of 2019).

The figures released on Friday by INE exceed the estimates by the government, the Organisation for Economic Cooperation and Development (OECD), the International Monetary Fund (IMF) and the Public Finance Council by one tenth, but are in line with the forecasts of the Bank of Portugal and the European Commission.

The figures known today are 0.4 percentage points below the growth registered in 2018 (2.4%), a year in which the Portuguese economy had already seen a slowdown compared to 2017 (3.5% growth).

According to the INE note released today, the economic growth registered last year “resulted from the less intense positive contribution of domestic demand, reflecting the slowdown in private consumption”.

“Net external demand made a slightly less negative contribution than in 2018, with a deceleration of exports and imports of goods and services”, the statistics institute’s quick estimate released today also states.

The 2.2% year-on-year increase in the fourth quarter had a positive contribution from “net external demand”, after “having been negative in previous quarters, with an acceleration in exports of goods and services and a deceleration in imports of goods and services”.

“Domestic demand made a smaller positive contribution than in the previous quarter, with a deceleration in private consumption and Gross Fixed Capital Formation [investment item]”, according to INE.

When comparing the fourth quarter with the performance of the economy in the third quarter of last year (quarter-on-quarter growth of 0.6%), INE points out that the contribution of net external demand “went from negative to positive in the fourth quarter, while the contribution of domestic demand was negative after being positive”.

After the quick estimate known today, INE will release the final figures on 28 February.