Companies are forecasting a 13% drop in exports this year. There will be less overseas sales both to the intra-EU and extra-EU market.
With exports sinking in recent months because of the pandemic, companies have adjusted their prospects for the overseas sales they will be able to make this year. The result is a forecast drop in exports of 13% in 2020, with no substantial difference between the intra-EU and extra-EU market, according to the information provided by the National Institute of Statistics (INE).
“The perspectives of the exporting enterprises of goods point to a nominal decrease of 13.0% in exports in 2020, corresponding to a downward revision of 15.1 percentage points (p.p.) in the 1st forecast made in November 2019. This revision results from the downward update of expectations for Intra-EU exports (-14.7 p.p., to -12.3%) and for Extra-EU exports (-16.1 p.p., to -15.0%),” reveals the statistics office.
Half of the companies surveyed by INE state that the pandemic crisis is the reason for the downward revision of export prospects, a percentage that is even higher among manufacturing industries. “From the enterprises that presented revisions in exports compared to the 1st forecast (56.7% of respondents), more than half (53.0%) reported that this revision was due entirely to the Covid-19 pandemic, corresponding to 98% of the downward revision from the 1st forecast,” reads the statement.
As a consequence of the pandemic, 14.2% of companies have already changed or will change their production and export strategy. Options range between diversifying destination markets (mentioned by 31.7% of companies), refocusing exports on EU markets (13.8%) and diversifying suppliers (11.0%).
The companies indicated, as the main reasons for the downward revision, the worst performance than expected in most of their usual destination markets (41.4%) and in specific destination markets (14.1%)