Since 2009, Portugal has been suffering from the worst economic crisis since the fall of the dictatorship in 1974. This deep recession was caused by the collapse of foreign demand and the restrictive financial conditions that have affected all the sectors of the economy, such as exports and investments in particular. After three years of recession, which was further worsened by the government's austerity measures (-1.8% in 2013), by late 2013 the Portuguese economy has been showing signs of recovery and a return to positive growth is expected in 2014 (0.8%).
In May 2011, Portugal signed a 78 billion EUR bailout agreement with the Troika (EU-ECB-IMF), in order to reduce its budget deficit. Under this agreement, the government launched a plan of reforms and structural adjustments, including budget cuts, tax increases, a large privatization program expected to earn the country 7 billion EUR, a bank recapitalization plan, and a reform of the labor market. In 2013, after three years of unprecedented austerity measures, the country's stability was shaken. The Minister of European Affairs resigned and the President of the Republic Anibal Cavaco Silva put the policy of austerity publicly in questions and was supported by the Constitutional Court. Debt continued to deepen, reaching more than 125% of the GDP. The 2014 budget, which was amended at the beginning of the year, includes new budget cuts, with the aim of saving 3.9 billion euro. Portugal has made a pledge to its creditors to reduce its public deficit to 4% in 2014. The country has been trying to regain investors' trust in order to fund its heavy debt burden on the financial markets and avoid the need for a second bailout plan.
With an unemployment rate rising to over 16%, which affects 36% of people under 25 years of age, an increase in social inequality between the north and the south, and the weakening of purchasing power, social tensions have been more keenly felt.
|Main Indicators||2011||2012||2013||2014||2015 (e)|
|GDP (billions USD)||238.11||212.26||220.06||228.17||231.97|
|GDP (Constant Prices, Annual % Change)||-1.3||-3.2||-1.4e||1.0||1.5|
|GDP per Capita (USD)||22,417||20,065||20||21,748e||22,089|
|General Government Balance (in % of GDP)||-6.5||-3.9||-2.9||-2.3||-1.5|
|General Government Gross Debt (in % of GDP)||108.2||124.1||128.9||131.3e||128.7|
|Inflation Rate (%)||3.6||2.8||0.4||0.0||1.1|
|Unemployment Rate (% of the Labor Force)||12.7||15.5||16.2||14.2||13.5|
|Current Account (billions USD)||-16.71||-4.28||1.17e||1.45e||1.93|
|Current Account (in % of GDP)||-7.0||-2.0||0.5||0.6||0.8|
Source: IMF - World Economic Outlook Database , Last Available Data
Note: (e) Estimated Data
The agricultural sector, with low productivity due to low level of mechanization, represents a little over 2% of Portugal's GDP and employs 11% of the population. The main crops are cereals, fruits, vegetables and wine. The exports of Port wine represent 1.4% of total exports and the country is one of the world's 10 largest wine exporters. Portugal has many natural resources. The mining sector (copper, tin) represents 6% of the GDP and Portugal is one of the main exporters of marble. The forests provide a large portion of the world's cork supply.
The manufacturing industry is modern and it is made up of small and medium-sized companies. Its main sectors of activity are metallurgy, mechanical engineering, textiles and construction. Moreover, the country has increased its role in the European automobile sector and has a world class mold manufacturing industry.
Services, particularly tourism, play an important role which is increasing rapidly. The tertiary sector contributes to almost 75% of the GDP and employs 60% of the active population.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||10.5||25.6||63.8|
|Value Added (in % of GDP)||2.3||21.1||76.7|
|Value Added (Annual % Change)||2.7||-1.9||-0.9|
Source: World Bank - Last Available Data.
|Euro (EUR) - Average Annual Exchange Rate For 1 USD||0.68||0.72||0.76||0.72||0.78|
Source: CIA - The world factbook - Last Available Data.
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.
Portugal's economy is open to foreign investment, trade represents more than 75% of the GDP (during the period 2010-2012). Becoming a member of the European Union changed the structure of the Portuguese imports and exports. The country exports more and more technological equipment instead of the traditional agricultural products or products from the textile and clothing industry. The European Union is Portugal's main client, followed by the United States. Other commercial partners of Portugal are China, Nigeria and Brazil.
The trade balance of Portugal is structurally in deficit, however it saw an improvement during the crisis of 2009, imports falling more quickly than exports. In 2013, the country's trade surplus reached historical levels, with exports growing more quickly than imports.
|Foreign Trade Indicators||2009||2010||2011||2012||2013|
|Imports of Goods (million USD)||71,648||75,635||82,466||72,162||75,194|
|Exports of Goods (million USD)||44,310||48,736||59,675||58,328||62,872|
|Imports of Services (million USD)||14,154||14,303||15,808||13,252||14,015|
|Exports of Services (million USD)||22,401||23,030||26,349||24,216||27,019|
|Imports of Goods and Services (Annual % Change)||-9.9||7.8||-5.8||-6.6||3.6|
|Exports of Goods and Services (Annual % Change)||-10.2||9.5||7.0||3.1||6.4|
|Imports of Goods and Services (in % of GDP)||34.0||37.4||38.6||38.0||38.3|
|Exports of Goods and Services (in % of GDP)||27.1||29.9||34.3||37.3||39.3|
|Trade Balance (million USD)||-24,981||-25,266||-19,667||-11,570||-9,646|
|Trade Balance (Including Service) (million USD)||-16,408||-16,636||-9,067||-256||3,767|
|Foreign Trade (in % of GDP)||61.1||67.3||72.9||75.4||77.5|
Source: WTO - World Trade Organization ; World Bank , Last Available Data
(% of Exports)
|See More Countries||41.0%|
(% of Imports)
|See More Countries||46.8%|
Source: Comtrade, Last Available Data
|- bn USD of products exported in 2013|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals||9.3%|
|Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702)||3.9%|
|Parts and accessories for tractors, motor vehicles...Parts and accessories for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles of heading 8701 to 8705, n.e.s.||3.8%|
|Footwear with outer soles of rubber, plastics,...Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of leather (excl. orthopaedic footwear, skating boots with ice or roller skates attached, and toy footwear)||3.2%|
|Uncoated paper and paperboard, of a kind used for...Uncoated paper and paperboard, of a kind used for writing, printing or other graphic purposes, and non-perforated punch-cards and punch tape paper, in rolls or in square or rectangular sheets, of any size, and hand-made paper and paperboard (excl. newsprint of heading 4801 and paper and paperboard of heading 4803)||2.4%|
|See More Products||77.3%|
|- bn USD of products imported in 2013|
|Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals, crude||12.4%|
|Parts and accessories for tractors, motor vehicles...Parts and accessories for tractors, motor vehicles for the transport of ten or more persons, motor cars and other motor vehicles principally designed for the transport of persons, motor vehicles for the transport of goods and special purpose motor vehicles of heading 8701 to 8705, n.e.s.||3.5%|
|Petroleum gas and other gaseous hydrocarbonsPetroleum gas and other gaseous hydrocarbons||3.3%|
|Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702)||3.2%|
|Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses incl. those in the form of transdermal administration or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006)||2.9%|
|See More Products||74.7%|
Source: Comtrade, Last Available Data
|- bn USD of services exported in 2011|
|Personal travelPersonal travel||38.26%|
|Business travelBusiness travel||4.25%|
|Air transportAir transport||17.33%|
|Road transportRoad transport||6.20%|
|Sea transportSea transport||3.44%|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||11.79%|
|Architectural, engineering,...Architectural, engineering, and other technical services||3.20%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||2.65%|
|Services between related...Services between related enterprises, n.i.e.||1.84%|
|Advertising, market research,...Advertising, market research, and public opinion polling||1.52%|
|Agricultural, mining, and...Agricultural, mining, and on-site processing services||1.24%|
|Other business servicesOther business services||1.10%|
|Research and developmentResearch and development||0.25%|
|Merchanting and other trade-related...Merchanting and other trade-related services||6.46%|
|Operational leasing servicesOperational leasing services||0.47%|
|Construction abroadConstruction abroad||2.56%|
|Construction in the compiling...Construction in the compiling economy||0.42%|
|Telecommunications servicesTelecommunications services||2.37%|
|Postal and courier servicesPostal and courier services||0.10%|
|Computer servicesComputer services||1.90%|
|Information servicesInformation services||0.07%|
|Other personal, cultural, and...Other personal, cultural, and recreational services||0.82%|
|Audiovisual and related servicesAudiovisual and related services||0.43%|
|Embassies and consulatesEmbassies and consulates||0.68%|
|Freight insuranceFreight insurance||0.01%|
|- bn USD of services imported in 2011|
|Air transportAir transport||13.67%|
|Sea transportSea transport||9.49%|
|Road transportRoad transport||5.46%|
|Personal travelPersonal travel||19.80%|
|Business travelBusiness travel||6.25%|
|Miscellaneous business,...Miscellaneous business, professional, and technical services||11.88%|
|Architectural, engineering,...Architectural, engineering, and other technical services||2.87%|
|Legal, accounting, management...Legal, accounting, management consulting, and public relations||2.15%|
|Advertising, market research,...Advertising, market research, and public opinion polling||1.90%|
|Services between related...Services between related enterprises, n.i.e.||1.90%|
|Other business servicesOther business services||1.45%|
|Agricultural, mining, and...Agricultural, mining, and on-site processing services||1.39%|
|Research and developmentResearch and development||0.22%|
|Merchanting and other trade-related...Merchanting and other trade-related services||7.80%|
|Operational leasing servicesOperational leasing services||1.40%|
|Other personal, cultural, and...Other personal, cultural, and recreational services||2.29%|
|Audiovisual and related servicesAudiovisual and related services||1.90%|
|Embassies and consulatesEmbassies and consulates||0.58%|
|Computer servicesComputer services||3.42%|
|Information servicesInformation services||0.44%|
|Telecommunications servicesTelecommunications services||3.54%|
|Postal and courier servicesPostal and courier services||0.13%|
|Franchises and similar rightsFranchises and similar rights||0.18%|
|Freight insuranceFreight insurance||0.39%|
|Construction abroadConstruction abroad||0.66%|
|Construction in the compiling...Construction in the compiling economy||0.37%|
Source: Comtrade, Last Available Data
The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
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Last Updates: January 2015