December 18, 2018 / 9:11 AM / a year ago

Bank of Portugal trims economic forecasts on exports, tourism

LISBON, Dec 18 (Reuters) - The Bank of Portugal on Tuesday trimmed its economic growth forecasts for this year and next due to decelerating export growth and a weakening tourism market after a long boom which had helped the country recover from its 2010-14 debt crisis.

The central bank now sees gross domestic product expanding 2.1 percent this year, down from its previous forecast of 2.3 percent. Next year, the bank predicts a GDP increase of 1.8 percent, down from 1.9 percent previously.

The Socialist government of Prime Minister Antonio Costa still projects 2.3 percent growth this year, in a slowdown from last year’s 2.8 percent, which was the strongest expansion since 2000, and forecasts a 2.2 percent expansion in 2019.

The central bank said exports should grow just 3.6 percent this year and 3.7 percent in 2019, less than half of the pace in 2017, and well below its previous forecasts of 5 percent and 4.6 percent respectively.

Tourism has been of the main contributors to Portugal’s export growth and economic recovery as a whole in the past few years, but data showed last week the number of foreign tourists edged lower in the first 10 months of this year, the first cumulative decline after years of record figures.

The central bank expected “tourism to present only marginal gains” through 2021. (Reporting By Andrei Khalip, editing by Axel Bugge)

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