António Costa and Olaf Scholz in Hannover in 2022
One of the historical partners of the Portuguese economy is sinking. What consequences does it bring for Portugal?
Germany is the third largest market for Portuguese exporters, only surpassed by neighbors Spain and France: Germans consume almost 11% of the products made in Portugal, count the
According to a complex carried out by the Strategy and Studies Office (GEE) of the Ministry of Economy, international trade between Portugal and Germany translates into a gigantic 14 billion euros per year (2023 data) in exports.
8.2 billion euros of these exports represent goodsbut the rest (5.8 billion) is invested in services — the main one being tourism by a long margin. Germany is the second country on a list headed by the United Kingdom, which most drives tourism in Portugal.
Last year, the country welcomed around 6 million German touristsa mark that, according to DN, will be “clearly beaten this year because by September, the country had already received visits from five million Germans”.
According to the Agency for Investment and Foreign Trade of Portugal (AICEP), “in the structure of Portuguese exports of goods In 2023, the markets for Machinery and Apparatus (29.5%), Vehicles and Other Transport Material (18.8%), Optical and Precision Instruments (10.3%), Plastics and Rubber (7%) stand out. ”.
According to the agency, and considering the entire situation in the country, the European Commission predicts that Germany will underperform the eurozone by 2026.
The European Commission’s autumn forecast projects a GDP growth in 2024 of 0.8% in the euro areawhile, on the contrary, there will be a GDP contraction of 0.1% in Germany.
“A high uncertainty [causedby[provocadapelahas been weighing on consumption and investmentand trade prospects have worsened with weakening global demand for industrial goods”, writes the EU in the report.
According to DN, Germany has been, since the mid-80s of the last century, when it opened the large Autoeuropa factory, in Palmela, one of the main foreign investors in Portugal.
However, with the country’s economic downturn, it is expected that, here, there will be postponed sales and paused investments: when Germany enters a crisis, Portugal can fall by force.
