5 Aug 2015
Portuguese Economy Rallies as Country Looks to Boost Wine Exports
Figures for 2014 show end of three-year recession that has hampered country's growth, though trade deficit widens.
According to recently released figures, 2014 was the year when the Portuguese economy finally emerged from its three-year recession. Overall, it is seen that an improvement in domestic demand has boosted the country's economic situation. At the same time, the country's trade with both China and Hong Kong has also been on the up.
According to the Portuguese Institute of Statistics, during the course of 2014 imports increased 3.2%, reaching a total of €58,853.8 million, while exports showed an increase of the 1.8%. This led to an increase in the overall trade deficit, growing by €966.8 million to reach €10,676.7 million last year.
Spain remained Portugal's main trading partner, accounting for 23.5% of Portuguese exports of goods and for 32.5% of imports. The highest deficits in trade of goods were with Spain, Germany and Italy. Together, these three countries represented 46.9% of total exports. The highest surpluses were recorded with Angola, France and the US.
Due to a sharp decrease in import levels of mineral fuels, the highest trade of goods surplus was registered with Angola. The main categories of goods exported were machinery and mechanical appliances, vehicles, other transportation equipment and mineral fuels.
With regard to China, trade increased by 3.2% over the course of the last year. As a result, Portugal now accounts for 2.7% of China's overall exports, a figure of some €1.91 billion. Most of the trade is with regard to the consumer sector, although raw materials also make a significant contribution.
Overall, China's exports of electronic equipment to Portugal rose to a total value of US$502.2 million, while machines, engines and pumps accounted for a further $238 million. Others significant sectors were iron and steel ($149.1 million), organic chemicals ($102.6 million), vehicles ($84.7 million), footwear ($78.4 million), knitted and crocheted clothing ($74.4 million), leather and other animal products ($71.2 million), fish ($64.3 million) and plastics (63.9 million).
With regard to trade between Portugal and Hong Kong, in 2014 this exceeded €380 million, a year-on-year increase of nearly 17%. Overall, there is seen as a rising trend for the success of Hong Kong exports in the Portuguese market.
Unsurprisingly, Hong Kong's exports to Portugal are dominated by the electrical sector, although a number of other industries make a significant contribution. Most notably, these include telecommunications equipment parts, optical instruments and apparatus, electrical apparatus for electrical circuits, meters and counters, watches and clocks, household electrical and non-electrical equipment, and computers.
In 2014, Hong Kong's total exports to Portugal rose by nearly 21.6 %. Across the board, a number of different sectors recorded remarkable growth in different industries including telecommunications equipment parts (34%), optical instruments and apparatus (11.2%), electrical apparatus for electrical circuits (9.4%), metres and counters (5.6%), watches and clocks (4.5%), household electrical & non-electrical equipment (3%) and computers (2.9%).
Portugal is also looking to reinforce its position as one of the world's leading exporters of wine and has turned to Hong Kong to help boost its profile across Asia. Last year, Portuguese wine exports were valued at €725 million. Overall, winemaking represents 11% of the country's total food and drink sector, while also accounting for 1.5% of its total exports. Portugal is currently rated ninth in the international league of wine exporters.
The global significance of the country as a wine supplier has seen it appointed as the official partner nation for the 2015 HKTDC Hong Kong International Wine & Spirits Fair. The country will also have a dedicated pavilion at the event, which runs from 5-7 November.
Xavier Serra, Barcelona Consultant