The fall of the coming demand for some of the major customers of Portuguese exports and maintaining a worrying decline in investment joined the technical stops production in Galp and Autoeuropa to the first quarter of this year, a period in which accentuated the slowdown in the Portuguese economy, which failed to keep pace recorded in the rest of the euro zone.
the provisional data for the evolution of recorded GDP in the first quarter of 2016 were released on Friday by the National Institute Statistics (INE) and can not be said to have been a surprise, given the information that had already been released this week for international trade and the labor market.
the GDP in during the first quarter of the year a variation of 0.1% compared to the previous period. It is a value that is still positive, which means that the economy is not in recession, and that is not far from what happened in the last quarter of 2015, a variation of 0.2%.
However when you look at the performance over the last year, it is clear that the economy continues to show not only relaxation, as accentuated this trend start in 2016. the annual GDP growth went from a growth of 1.3% in the fourth quarter 2015 to only 0.8% in the first three months of this year. This is the lowest since the end of 2014.
Once you have registered an annual increase of 1.7% in the first quarter of 2015, GDP has consecutively slowing down, with growth of 1, 5% in the second quarter of this year, 1.4% in the third and 1.3% in the fourth.
Why is this result? Yesterday published note (which does not yet have specific values for the various components of GDP), the INE gives some clues. Says “net external demand showed a more negative contribution to the annual GDP growth in the previous quarter, reflecting the slowdown in exports of goods and services”.
It also explains that this negative performance of external demand net (exports minus imports) appears simultaneously with what the INE said to be a “positive contribution, close to the previous quarter” of domestic demand. Furthermore, within the domestic demand, the INE highlights the differences found in the performance of private consumption and investment. While private consumption recorded in the first quarter, a more “intensive growth” investment “slowed significantly.”
This is the acceleration of private consumption, which was expected due to the recovery measures of disposable income, not enough to offset the less positive results in exports and investment. And the economy slowed down.
The slowdown in exports and investment is to a large extent, a trend that has since last year, explained to PUBLIC, Paula Carvalho, chief economist at BPI. For exports, however, apart from braking already registered in some important markets for Portugal as Angola, Brazil and China, were decisive one-off factors that are related to the technical stops production that occurred in the two main exporters of goods country: Galp and Autoeuropa
in terms of investment, the explanation for the slowdown is less obvious, given that the trend began from the second half of last year and now continued..
Given the GDP figures published yesterday, the BPI economist is forced to revise its projections for the entire year. Before forecast a growth of 1.6% in 2016, now points to 1.5% or even 1.4%. An improvement over the 0.8% of the first quarter is considered likely, since from the second quarter, the basis of comparison from last year begins to be more favorable.
This is also why the Finance Minister in the state budget assumed a GDP growth of 1.8% this year, maintaining an optimistic speech. Mario Centeno said yesterday believe the economy will accelerate throughout the year, ensuring that the results now known “” did not make the difference at the end of last year we all expected. “
The great hope Minister lies in the development of external markets, “particularly some very important markets for Portuguese exports,” something “that should improve and recover throughout the year.”
what is certain is that for already, Portugal shows not keep pace (he also moderate) recorded in the rest of the European economy. The euro zone grew 0.5% over the previous quarter, which represents an acceleration compared to 0.3% in the fourth quarter of 2015.
On the other hand, the annual rate of change GDP in the euro area declined slightly, from 1.6% in the fourth quarter of 2015 to 1.5% now.
in the two indicators is apparent worsening of the divergence of the Portuguese economy face the economies of the rest of euro zone. During the course of 2015 and early 2016, the euro area has maintained its growth rate stabilized at around 1.5%, while Portugal, which started last year at a similar pace, recorded after a slowdown progressive, now accentuated.
Among the countries that have reported data for the first quarter of this year, Portugal was the third country in the euro area with GDP growth in lower chain, just above Greece and Estonia, and the second country with a worse annual growth, surpassing only Greece.
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