Portugal Economy

Portugal has become a diversified and increasingly service-based economy since joining the European Community in 1986. Over the past decade, successive governments have privatized many state-controlled firms and liberalized key areas of the economy, including the financial and telecommunications sectors.

Economy - overview:
The country qualified for the European Monetary Union (EMU) in 1998 and began circulating the euro on 1 January 2002 along with 11 other EU member economies. Economic growth had been above the EU average for much of the past decade, but fell back in 2001-04. GDP per capita stands at two-thirds that of the Big Four EU economies. A poor educational system, in particular, has been an obstacle to greater productivity and growth. Portugal has been increasingly overshadowed by lower-cost producers in Central Europe and Asia as a target for foreign direct investment. The government faces tough choices in its attempts to boost Portugal's economic competitiveness while keeping the budget deficit within the eurozone's 3%-of-GDP ceiling.

GDP:
purchasing power parity - $204.4 billion (2005 est.)

GDP - real growth rate:
0.3% (2005 est.)

GDP - per capita:
purchasing power parity - $19,300 (2005 est.)

GDP - composition by sector:
agriculture: 5.3%
industry: 27.4%
services: 67.3% (2003)

Labor force:
5.52 million (2005 est.)

Labor force - by occupation:
agriculture 10%, industry 30%, services 60% (1999 est.)

Unemployment rate:
7.6% (2005 est.)

Population below poverty line:
36%

Household income or consumption by percentage share:
lowest 10%: 3.1%
highest 10%: 28.4% (1995 est.)

Distribution of family income - Gini index:
38.5 (1997)

Inflation rate (consumer prices):
2.3% (2005 est.)

Investment (gross fixed):
21.6% of GDP (2005 est.)

Budget:
revenues: $78.84 billion
expenditures: $90.27 billion, including capital expenditures of NA (2005 est.)

Public debt:
63.9% of GDP (2005 est.)

Agriculture - products:
Grain, potatoes, olives, grapes, sheep, cattle, goats, poultry, beef, dairy products

Industries:
Textiles and footwear; wood pulp, paper, and cork; metals and metalworking; oil refining; chemicals; fish canning; rubber and plastic products; ceramics; electronics and communications equipment; rail transportation equipment; aerospace equipment; ship construction and refurbishment; wine; tourism

Industrial production growth rate:
0% (2005 est.)

Electricity - production:
44.32 billion kWh (2003)

Electricity - consumption:
44.01 billion kWh (2003)

Electricity - exports:
3.1 billion kWh (2003)

Electricity - imports:
5.9 billion kWh (2003)

Oil - production:
0 bbl/day (2004 est.)

Oil - consumption:
326,500 bbl/day (2003 est.)

Oil - exports:
28,830 bbl/day (2001)

Oil - imports:
357,300 bbl/day (2001)

Natural gas - production:
0 cu m (2003 est.)

Natural gas - consumption:
2.983 billion cu m (2003 est.)

Natural gas - exports:
0 cu m (2001 est.)

Natural gas - imports:
2.553 billion cu m (2001 est.)

Current account balance:
$-17.1 billion (2005 est.)

Exports:
$38.8 billion f.o.b. (2005 est.)

Exports - commodities:
clothing and footwear, machinery, chemicals, cork and paper products, hides

Exports - partners:
Spain 25%, France 14%, Germany 13.5%, UK 9.6%, US 6%, Italy 4.3%, Netherlands 4% (2004)

Imports:
$60.35 billion f.o.b. (2005 est.)

Imports - commodities:
machinery and transport equipment, chemicals, petroleum, textiles, agricultural products

Imports - partners:
Spain 29.3%, Germany 14.3%, France 9.3%, Italy 6.1%, UK 4.6%, Netherlands 4.6% (2004)

Reserves of foreign exchange and gold:
$10.36 billion (2005 est.)

Debt - external:
$287.8 billion (2005 est.)

Economic aid - donor:
ODA, $271 million (1995)

Currency (code):
euro (EUR)
note: on 1 January 1999, the European Monetary Union introduced the euro as a common currency to be used by financial institutions of member countries; on 1 January 2002, the euro became the sole currency for everyday transactions within the member countries

Exchange rates:
Euros per US dollar - 0.8041 (2005), 0.8054 (2004), 0.886 (2003), 1.0626 (2002), 1.1175 (2001)

Fiscal year:
Calendar year