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The Bank of Portugal States that Tourism Related Exports Will Double from 2008 to 2020

21 June 2018

According to the Economic Bulletin, published today, the Portuguese central bank predicted that Portuguese exports of goods and services in 2020 would be 67% higher than those of 2008, the beginning of the economic and financial crisis, highlighting the tourism component, “more than doubling its previous level.”

The Bank of Portugal (BdP) stated that “after a notable increase in tourism-related exports in recent years, robust growth is projected to continue for the foreseeable future, albeit below the rates observed in the most recent period.” The report added that tourism exports, which is defined as spending by foreign visitors to the country, will account for about 8% of GDP in 2020.

“At the end of the forecasting horizon, exports of goods and services are expected to be 67% above the 2008 level and represent 51% of GDP, compared with 24% of GDP at the beginning of the euro era,” the central bank wrote in its “Projections for the Portuguese economy: 2018-2020.” The BdP added that “the tourism component, one of the most dynamic sectors in Portugal, stands out in the recent evolution of exports.”

The report emphasised that “tourism was the main service exported by the Portuguese economy, accounting for 17% of total exports of goods and services in 2017”, as well as demonstrating “remarkable dynamism in the recent period, higher than the growth observed in other Southern European countries.”

The central bank explained that “to assess the performance” of tourism exports, it calculated “an indicator of external tourism demand by weighing the growth of the nominal imports of tourism services from a set of 30 countries (balance of payments data), which accounted for 89% of Portuguese tourism exports in 2017 “and that “this weighting was made using the growth in the weight of each country as regards to Portuguese tourism exports.”

Accordingly, it concluded that “Portugal has also reregistered significant market share gains in every year since 2009, except 2012” and that “these gains were particularly high in 2016 and 2017”, in which Portuguese exports exceeded external demand growth by 9.8 pp and 14.3 pp, respectively.

The central bank further noted that the “demonstrated that there had been generalised gains regarding the main issuing markets for tourists.”

The central bank noted that the analysis showed “substantial market share gains in foreign markets” of around 20% in cumulative terms, and further stated that “the gain in share remained significant in 2017”, stating in its conclusion that the improvement “has been to a large extent associated with the extraordinary growth of tourism exports”.

Original Story: Presstur

Translation: Richard Turner