The number of new businesses registered fell 17% in the first quarter. Accommodation, restaurants and services were the most penalized sectors.
The Covid-19 pandemic has brutally affected the Portuguese business sector. In the first quarter of 2021, the number of new businesses fell 17% compared to 2020, due to a larger drop in registration of businesses compared to the number of bankruptcies, both in relative and absolute terms. The data was revealed this Wednesday by the Portuguese Business Association (AEP).
Nevertheless, the ratio of registration of businesses improved in the first quarter (to 3.5, including 4.0 in March). The number of bankruptcies fell 1.9% compared to the first quarter of 2020, but increased 4.4% compared to the first three months of 2019, including a 22.4% rise in March.
The accommodation and catering sectors were among the most penalized by the drop in registration of new businesses and the increase in the number of bankruptcies. Retail is the sector that concentrates the highest proportion of bankruptcies (18.1%), while business services have the highest weight in registration of new businesses (15.8%).
According to Eurostat data, until the third quarter, Portugal had one of the worst performances among European Union (EU) countries in 2020, both in the registration of new businesses (especially in the 2nd quarter, with a year-on-year rate of change of -48.2%, the highest drop) and in declarations of bankruptcies (YoY of 40.3% in the 3rd quarter, the second-highest increase).