Portuguese exports lose momentum amid weaker EU demand

Portugal’s goods exports are losing momentum after years of helping drive the country’s recovery, with weaker European demand, global uncertainty and stronger competition from Asian producers weighing on sales abroad. Exports have been a key pillar of Portugal’s growth model and their weaker performance comes as the country’s economic outlook has already been revised down.

Data from statistics office INE showed goods exports fell 6.4% year on year in the first quarter, while their share of GDP dropped by 1.5 percentage points to 26.3%. Although March posted a 10.6% increase from a year earlier, the broader trend remains weak, particularly in Portugal’s main European markets of Spain, France and Germany.

Business groups said the pressure is being felt across export-oriented industries including automotive components, moulds, textiles, clothing and industrial machinery. They pointed to softer industrial activity in Europe, especially in Germany, as well as higher energy and input costs and tougher competition from China and other external rivals.

The European Commission’s latest forecasts point to growth in Portugal’s exports of goods and services of just 0.6% in 2026, after 0.4% in 2025, before a partial recovery to 2.2% in 2027. Net exports are expected to make a negative contribution to GDP growth for a fourth straight year, underlining how domestic demand has become more important to the economy than external demand.

Originally published at Eco.pt