Tourism sector places Portugal among the fastest growing in the EU this year

22 May, 2023
Tourism sector places Portugal among the fastest growing in the EU this year

Source: Publico 

According to the European Commission's forecast, Portugal's economic growth will rise from 1% to 2.4%, as a result of the exponential recovery of the tourism industry in the first quarter of the year.

The tourism influx at the beginning of this year, mainly from North America, lead the European Commission to revise its economic forecasts for Portugal in the year 2023, placing the country as one of the best performers within the hospitality sector, in the entire European Union.

In the spring forecasts released on Monday (May 15th), the European executives revised their entire estimates for GDP growth throughout the European Union. Portugal was the country where this revision was more pronounced.

For the country's economic field and, according to the strong acceleration compared to the stagnation seen in previous quarters, Brussels revised its forecast in which February had already registered a growth of 1% in 2023, projecting Portugal's GDP up to 2.4%.

This is above the 1.8% prediction by the Portuguese government in the Stability Programme, but lower than the 2.6% projected by the International Monetary Fund last week.

This 2.4% growth for Portugal, if the estimates now released by the Commission come true, would put the country, as it already did in 2022, back in the top places in the EU in terms of economic performance.

In 2022, Portugal, with a GDP variation of 6.7%, it not only exceeded the EU average of 3.5% but was also, the third fastest-growing country among the 27 EU countries, behind Ireland and Malta.

For 2023, the growth forecast of 2.4% is more than double the estimated EU average of 1% and is the fourth highest among the 27 EU countries, again behind Ireland and Malta, plus Romania.

The explanation for the result now anticipated for the Portuguese economy this year, according to Commission officials, resides on what happened during the first three months of the year in the tourism sector. "The external sector was the main driver of growth in the first quarter of 2023, benefiting from a recovery in global supply chains and a very strong increase in tourist visits, particularly from North America," the Commission wrote in the report published on Monday.

Read full article, here!