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Portugal cuts official trade deficit in fight to beat crisis

Published on 09/04/2012

Portugal nearly halved its trade deficit in February on a 12-month comparison owing to a big rise in exports and a fall in imports, official data showed on Monday.

Portugal is struggling to overcome a debt crisis which has resulted in tough austerity action to reform the budget and the economy. In common with other eurozone countries in difficulty, the country needs to improve its export performance to help the economy grow.

In February the trade deficit fell by 45 percent to 720 million euros ($940.5 million).

In the month, exports rose by 6.1 percent and by 13.2 percent on a 12-month basis to total 3.752 billion euros.

Imports fell by 2.6 percent in the month and by 3.5 percent on a 12-month comparison to 4.472 billion euros.

The national statistics institute which published the data said that this reflected an improvement in the trade balance regarding other members of the European Union and with countries outside the EU.

One factor in the fall of imports was a reduction of purchases of transportation equipment from other EU countries.

Portugal has been rescued by the EU and International Monetary Fund. Official forecasts suggest that the economy will shrink by more than 3.0 percent this year and that the unemployment rate will be more than 14.0 percent.