LISBON: Portugal’s economy shrank 7.6 percent last year in its worst slump since 1936, as the COVID-19 pandemic drove an unprecedented decline in revenues from tourism, one of its core industries.
The drop was less extreme than the government’s 8.5 percent estimate, but still almost double the fall of 4.1 percent registered in 2012, when the country was under an austerity program linked to an international bailout
In the fourth quarter, GDP expanded 0.4 percent from the preceding three months, but still shrank 5.9 percent from a year earlier, the National Statistics Institute (INE) said in an advance flash estimate.
The government imposed a night-time curfew and partial weekend lockdown in early November, and tightened curbs in mid-January as the epidemic worsened. It is expected to trim its forecast of 5.4 percent growth for this year.
INE said domestic demand presented a significant negative contribution to the annual rate of change of GDP last year, while tourism exports experienced “an unprecedented reduction.”
Almost half of Portugal’s 726,321 COVID infections and 12,757 deaths caused by COVID-19 were reported last month, and hospitals are running short of intensive care beds and medical personnel.
The country has the world’s highest seven-day rolling average of new daily cases per million inhabitants, according to data tracker ourworldindata.org.
Portugal’s economy sinks 7.6% in biggest drop since 1930s
Portugal’s economy sinks 7.6% in biggest drop since 1930s
