Portugal

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Economics

Economy - overview

Portugal has become a diversified and increasingly service-based economy since joining the European Community - the EU's predecessor - in 1986. Over the past two decades, successive governments have privatized many state-controlled firms and liberalized key areas of the economy, including the financial and telecommunications sectors. The country qualified for the Economic and Monetary Union (EMU) in 1998 and began circulating the euro on 1 January 2002 along with 11 other EU members. The economy had grown by more than the EU average for much of the 1990s, but fell back in 2001-08, and contracted 2.6% in 2009, before growing 1% in 2010. GDP per capita stands at roughly two-thirds of the EU-27 average. A poor educational system and a rigid labor market have been obstacles to greater productivity and growth. Portugal also has been increasingly overshadowed by lower-cost producers in Central Europe and Asia as a destination for foreign direct investment. Portugal's low competitiveness, low growth prospects, and high levels of public debt have made it vulnerable to bond market turbulence. The government is implementing austerity measures, including a 5% public salary cut which went into effect on January 1, 2011 and a 2% increase in the value-added tax, to reduce the budget deficit from 9.3% of GDP in 2009 to 4.6% in 2011, but some investors have expressed concern about the government's ability to achieve these targets and cover its sovereign debt. Without the option for stimulus measures, the government is focusing instead on boosting exports and implementing labor market reforms to try to raise GDP growth and increase Portugal's competitiveness - which, over time, may help mitigate investor concerns.

GDP (purchasing power parity):

$247 billion (2010 est.)

country comparison to the world: 50

$243.6 billion (2009 est.)

$249.8 billion (2008 est.)

note: data are in 2010 US dollars

 

GDP (official exchange rate):

$229.3 billion (2010 est.)

 

GDP - real growth rate:

1.4% (2010 est.)

country comparison to the world: 162

-2.5% (2009 est.)

0% (2008 est.)

 

GDP - per capita (PPP):

$23,000 (2010 est.)

country comparison to the world: 57

$22,800 (2009 est.)

$23,400 (2008 est.)

note: data are in 2010 US dollars

 

GDP - composition by sector:

agriculture: 2.5%

industry: 22.9%

services: 74.7% (2010 est.)

 

Labor force:

5.581 million (2010 est.)

country comparison to the world: 66

 

Labor force - by occupation:

agriculture: 11.7%

industry: 28.5%

services: 59.8% (2009 est.)

 

Unemployment rate:

10.8% (2010 est.)

country comparison to the world: 117

9.5% (2009 est.)

 

Population below poverty line:

18% (2006)

 

Household income or consumption by percentage share:

lowest 10%: 3.1%

highest 10%: 28.4% (1995 est.)

 

Distribution of family income - Gini index:

38.5 (2007)

country comparison to the world: 73

35.6 (1995)

 

Investment (gross fixed):

19% of GDP (2010 est.)

country comparison to the world: 130

 

Budget:

revenues: $95.4 billion

expenditures: $116.5 billion (2010 est.)

 

Taxes and other revenues:

41.6% of GDP (2010 est.)

country comparison to the world: 36

 

Budget surplus (+) or deficit (-):

-9.2% of GDP (2010 est.)

country comparison to the world: 193

 

Public debt:

93% of GDP (2010 est.)

country comparison to the world: 13

83% of GDP (2009 est.)

 

Inflation rate (consumer prices):

1.4% (2010 est.)

country comparison to the world: 42

-0.8% (2009 est.)

 

Central bank discount rate:

1.75% (31 December 2010)

country comparison to the world: 125

1.75% (31 December 2009)

note: this is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area

 

Commercial bank prime lending rate:

4.225% (31 December 2010 est.)

country comparison to the world: 166

4.694% (31 December 2009 est.)

 

Stock of narrow money:

$95.9 billion (31 December 2010 est.)

country comparison to the world: 31

$103.8 billion (31 December 2009 est.)

note: see entry for the European Union for money supply in the euro area; the European Central Bank (ECB) controls monetary policy for the 17 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of money circulating within their own borders

 

Stock of broad money:

$319.4 billion (31 December 2010 est.)

country comparison to the world: 26

$311 billion (31 December 2009 est.)

 

Stock of domestic credit:

$556.3 billion (31 December 2009 est.)

country comparison to the world: 25

$490.8 billion (31 December 2008 est.)

 

Market value of publicly traded shares:

$82 billion (31 December 2010)

country comparison to the world: 41

$98.65 billion (31 December 2009)

$68.71 billion (31 December 2008)

 

Agriculture - products:

grain, potatoes, tomatoes, olives, grapes; sheep, cattle, goats, pigs, poultry, dairy products; fish

 

Industries:

textiles, clothing, footwear, wood and cork, paper, chemicals, auto-parts manufacturing, base metals, dairy products, wine and other foods, porcelain and ceramics, glassware, technology, telecommunications; ship construction and refurbishment; tourism

 

Industrial production growth rate:

1.6% (2010 est.)

country comparison to the world: 138

 

Electricity - production:

46.53 billion kWh (2009 est.)

country comparison to the world: 51

 

Electricity - consumption:

48.27 billion kWh (2008 est.)

country comparison to the world: 47

 

Electricity - exports:

2.822 billion kWh (2009 est.)

 

Electricity - imports:

4.776 billion kWh (2009 est.)

 

Oil - production:

4,721 bbl/day (2010 est.)

country comparison to the world: 95

 

Oil - consumption:

277,400 bbl/day (2010 est.)

country comparison to the world: 49

 

Oil - exports:

49,650 bbl/day (2009 est.)

country comparison to the world: 80

 

Oil - imports:

294,600 bbl/day (2009 est.)

country comparison to the world: 37

 

Oil - proved reserves:

0 bbl (1 January 2011 est.)

country comparison to the world: 179

 

Natural gas - production:

0 cu m (2010 est.)

country comparison to the world: 114

 

Natural gas - consumption:

5.161 billion cu m (2010 est.)

country comparison to the world: 59

Natural gas - exports:

0 cu m (2010 est.)

country comparison to the world: 161

 

Natural gas - imports:

5.122 billion cu m (2010 est.)

country comparison to the world: 33

 

Natural gas - proved reserves:

0 cu m (1 January 2011 est.)

country comparison to the world: 181

 

Current account balance:

-$22.61 billion (2010 est.)

country comparison to the world: 187

-$25.6 billion (2009 est.)

 

Exports:

$48.91 billion (2010 est.)

country comparison to the world: 57

$44.67 billion (2009 est.)

 

Exports - commodities:

agricultural products, food products, wine, oil products, chemical products, plastics and rubber, hides, leather, wood and cork, wood pulp and paper, textile materials, clothing, footwear, machinery and tools

 

Exports - partners:

Spain 26.8%, Germany 13.1%, France 11.9%, UK 5.5%, Angola 5.2% (2010)

 

Imports:

$72.67 billion (2010 est.)

country comparison to the world: 38

$69.5 billion (2009 est.)

 

Imports - commodities:

agricultural products, chemical products, vehicles and other transport material, and optical and precision instruments, computer accessories and parts, semi-conductors and related devices

 

Imports - partners:

Spain 31.3%, Germany 13.8%, France 7.3%, Italy 5.7%, Netherlands 5.2% (2010)

 

Reserves of foreign exchange and gold:

$21 billion (31 December 2010 est.)

country comparison to the world: 57

$16.03 billion (31 December 2009 est.)

 

Debt - external:

$548.3 billion (30 June 2011)

country comparison to the world: 21

$497.8 billion (30 June 2010)

 

Stock of direct foreign investment - at home:

$110.2 billion (31 December 2010 est.)

country comparison to the world: 32

$114.7 billion (31 December 2009 est.)

 

Stock of direct foreign investment - abroad:

$64.25 billion (31 December 2010 est.)

country comparison to the world: 31

$68.47 billion (31 December 2009 est.)

 

Exchange rates:

euros (EUR) per US dollar -

0.755 (2010)

0.7198 (2009)

0.6827 (2008)

0.7345 (2007)

0.7964 (2006)