Portugal trade deficit narrows 35% in 2012

Portugal’s trade deficit narrowed by 34.8 percent in 2012 to 10.7 billion euros ($14.3 billion), the official INE statistics office said on Monday, on a surge in exports and declining imports.

Exports, which have become the only engine in Portugal’s crisis hit economy, increased by 5.8 percent last year to 45.3 billion euros, the office said.

Imports of goods and services meanwhile fell by 5.4 percent to 56 billion euros.

Crushed by soaring public debt load, Portugal has implemented tough austerity measures in return for rescue loans from the European Union and International Monetary Fund.

Under the weight of the cutbacks in public spending, the Portugese economy is expected to contract by 3.0 percent in 2012.

The central bank has forecast a further recession of 1.9 percent in 2013.