Eurostat.Portugal’s purchasing power sink

In Portugal, real personal consumption per capita (AIC), an indicator of family material well-being, fell 17% below last year’s European Union (EU) average. This is 2020. According to data released by Eurostat this Monday, Portugal’s purchasing power fell to 83% in 2021.

Overall, actual per capita personal consumption as expressed in Purchasing Power Standards (PPS) ranged from 63% to 146% of the EU average for 27 member countries.

During the same period under consideration, nine member countries recorded per capita AIC above the EU average. Luxembourg (46%) was the only member state to record an AIC per capita, more than 25% above the EU average. In Denmark, Germany, the Netherlands, Belgium, Austria, Sweden, Finland and France, levels were more than 10% above the EU average.

In 13 member states, per capita AIC was between the EU average and 25%, according to data from the European Statistics Bureau. There were significant differences between member countries in this category. In Italy, Lithuania, Cyprus and Ireland, levels were less than 10% below the EU average, while Slovenia, Spain, the Czech Republic, Poland, Portugal, Malta and Romania were between 11. % And 20% lower. Estonia and Greece were 21% and 23% below the EU average, respectively.

There are still five member countries with per capita AIC registrations that are more than 25% below the EU average. Croatia, Latvia, Hungary and Slovakia were 27% to 30% lower, and Bulgaria recorded AIC per capita 37% below the EU average.

And GDP? Gross domestic product (GDP) per capita in 2021 also recorded significant differences among member states, from the EU average of 55% in Bulgaria to 277% in Luxembourg. According to the Eurostat, Luxembourg’s high numbers are “contributing to GDP but not considered part of the resident population” and “the proportion of cross-border workers in the country’s total employment. High is also a factor. ” This is used to calculate GDP per capita. “

In addition to Luxembourg, Ireland stands out among the 10 EU countries that have registered above average GDP per capita, the high level of which is “partly due to the presence of large multinationals with intellectual property. I can explain it in a specific way. “

Contract manufacturing associated with these assets contributes to GDP, adding that most of the revenue from this production goes back to the end owners of foreign companies.

In Portugal, per capita GDP was 74% of the European Union average.

Inflation and purchasing power And if prices have already risen in 2021 and purchasing power has declined, inflation will continue to reach record highs this year. I called on XTB analyst Henrique Tomé to pay attention to rising inflation. “Inflation remains a major issue for Portugal,” analysts said.

“The truth is that the Portuguese family is increasingly losing purchasing power, which could have a more serious impact on the economy in the medium term,” he added.

For Henrique Tome, “This is a big challenge for Portugal, to be able to sustain economic growth with high inflation. As soon as the Portuguese economy begins to show signs of slowing, and with high inflation. If so, we will be seriously affected financially. “

The opinion of Paulo Rosa, an economist at Banco Carregosa, does not change much. When the Bank of Portugal estimates this year’s inflation rate at 5.9%, economists said that our inflation rate is “mainly on the supply side, especially suffering from rising fossil fuels and rising food prices.” I recall. , Especially cereals and meat. ” In his view, this rise in prices “tends to penalize family disposable income, reduce demand, and reduce company profits.”

And in this context, “the possibility of economic stagnation scenarios associated with stagflation, high inflation is even greater, and the war and rising fossil fuel prices in Ukraine are longer and more serious. This will intensify inflation and slow economic growth. “

Remember that economist Eugenio Rosa also warned about the consequences of national poverty and inflation. “Inflation harms those who have bonds such as salaries and pensions, because they do not rise rapidly and can rise weekly in the dimension seen in prices, causing a loss of purchasing power. “It’s possible,” he said, “they can raise prices when they want, which benefits variable-income holders.”

Economists also ensure that rising prices “cause serious deterioration in the living conditions of workers and pensioners and are eroding savings.”

And the price may go up. The Governor of the European Central Bank expected “undesirable high inflation” in the euro area in the coming months and a recovery in the tourism services sector to support economic growth.

Food prices rise Those who go to supermarkets on a regular basis are already aware that prices are rising, and Deco Proteste’s analysis is undoubtedly. The food group that Deco monitors weekly is about 20 euros higher than at the end of February before the invasion. Russian in Ukraine.

After all, the price of baskets of essential foods rose 0.95% (1.91 euros more) between June 8th and 15th, reaching a cost of 203.20 euros. More than 100 days after the start of the war in Ukraine (February 24th), when Deco began this analysis, purchasing the same basket of food would cost € 19.57 (10.66% more).

But what kind of products are we talking about? The basket analyzes a total of 63 essential foods such as turkey, chicken, brush, horse mackerel, onion, potato, carrot, banana, apple, orange, rice, spaghetti, sugar, ham, milk, cheese and butter.

The 10 products Deco found the biggest price increases this week during its analysis were hake (17%), carolino rice (9%), frozen peas (8%), sea bass (6%) and swordfish. Swordfish (6%), hake medallions (6%), sea bream (4%), red potatoes (4%), fish goldfish (4%), kurujet (3%).
However, if we analyze only the product categories with the highest prices between February 23 and June 15, cooking oil is the most prominent and rises at a rate of 50%.

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