The pandemic affected international trade and Portugal was no exception: exports of goods fell by 10.2% in 2020, for the first time since 2009, and imports by 15.2%.
Portuguese exporters have not escaped the pandemic crisis. The National Statistics Institute (INE) revealed on Tuesday that exports of goods shrank by 10.2% in 2020, the first drop since the previous crisis in 2009. But the fall in economic activity also led to a 15.2% drop in imports of goods. The result is a significantly lower deficit of trade balance than in 2019.
“When considering the year 2020 as a whole, exports and imports of goods fell by 10.2% and 15.2%, respectively (+3.5% and +6.0% in 2019, in the same order) and the deficit of trade balance decreased by 6,024 million euros to 14,051 million euros,” the statistics office reveals, adding that “since 2009, exports of goods had not recorded a negative annual growth rate.”
These falls in international trade in goods are the first since 2009, but are still below the percentage falls recorded during the global financial crisis. In 2009, exports – which were almost half of the pre-pandemic value at the time – sank by 18.4% and imports by 20%.
After 10 years of consecutive growth, exports of goods were hit by the pandemic, although the fall was below some more negative forecasts. Exports fell by 6,130 million euros in one year to a total of 53,772.5 million euros.
Imports of goods shrank by 12,154.1 million euros in one year to a total of 67,823 million euros. The result of falling imports (in absolute value) to double that of exports was an increase in the coverage rate by 4.4 percentage points to 79.3% in 2020.
Companies expect exports of goods to recover 4.9% by 2021, which will still not be enough to compensate for last year’s fall. Far from it: the value of exports of goods will remain about 10% below the 2019 total.
Monthly data on international trade in goods show that the year-on-year fall in exports intensified in December to 7.8% (0.2% in November). In the opposite direction, imports slowed down from 11.9% in November to 6.9% in December.
In December, “The emphasis was on the declines in exports and imports of Fuels and lubricants (-45.1% and -32.0% respectively) and Transport equipment (-20.8% and -16.3%, in the same order),” according to INE.
This performance has led to a tenuous drop in the deficit of trade balance this month compared to the same month in 2019 (-59 million euros).