Portugal’s exports to PALOP countries and East Timor fall in 2010 for second year running

22 September 2011

Lisbon, Portugal, 22 Sept – Portuguese exports to Portuguese-speaking African countries (PALOP) and East Timor fell in 2010 for the second consecutive year to 2.4 billion euros, according to a report published Tuesday in Lisbon by the Bank of Portugal.

The report, presented during the 21st Meeting of Central Banks of the Portuguese-speaking Countries, said that Portugal’s exports to the PALOPs and East Timor fell further in 2010 with a drop of 6.6 percent, after falling 8.3 percent in 2009.

This drop, the report said, was driven by a fall in exports to Angola (328 million euros) and to East Timor (3 million euros), whilst exports to the other countries rose slightly.

Portuguese imports from this group of countries totalled 602 million euros in 2010 as compared to 398 million euros the previous year, due to growth in Angolan imports.

Since 2006 Angola has been, of this group of countries, the biggest destination for Portuguese exports as well as the biggest supplier, accounting respectively for 94 percent and 79 percent of the total in 2010.

“Imports are clearly dominated by fossil fuels from Angola, which account for 93 percent of the total,” the report said.

The report, which follows the economies of the PALOP countries and East Timor in 2010/2011, said that the rise in oil revenues and the “largely positive” execution of the International Monetary Fund (IMF) programme had led to “an appreciable correction” of budgetary imbalances in Angola, which posted a budget surplus of 8.9 percent of gross domestic product (GDP).

In Cape Verde, the execution of a large public investment programme boosted economic activity, but also led to a rise in the budget deficit (-10.9 percent) and in foreign debt (83.5 percent).

The stabilisation of the social and political situation in Guinea Bissau had positive repercussions on the country’s economic performance the report said, adding that this also led to a rise in cashew exports, which are Guinea’s main export product.

In Mozambique, the report noted that the “export dynamics” of the large projects in the areas of aluminium, electricity, natural gas, titanium and coal, had been essential over the last few years and had allowed an “acceleration of growth and foreign reserves,” but prices of raw materials and the depreciation of the metical had led to sharp inflation rises, from 3.3 percent in 2009 to 12.7 percent in 2010.

The Sao Tome and Principe economy, according to the report, continued to have “a robust rate of growth,” in 2010, but the “favourable impact” was not sufficient to prevent a rise in inflation, mainly due to the international prices of raw materials.

In East Timor, the economy continued to grow rapidly in 2010, thus consolidating its “comfortable” foreign budgetary position, with no foreign debt and the balance of the Oil Fund at “high levels.” (macauhub)