DREM releases Regional Accounts Data for the period 2021-2023 according to the 2021 benchmark

Statistics Portugal (INE) released today the results of the Regional Accounts according to the 2021 benchmark (which replaces the previous 2016 benchmark) for the years 2021 and 2022 (both final data) and for the year 2023 (preliminary data). In this release, INE is only providing data for the mentioned years, with the data for the previous years (the 2000-2020 period) expected to occur in June 2025.

When comparing the year 2021 across the two benchmarks, the last year with final data according to the 2016 benchmark, it was observed that, for the Autonomous Region of Madeira (ARM), the Gross Domestic Product (GDP) was revised upwards by 47.5 million euros (+0.9%).

The 2021 benchmark incorporates new structural statistical information, particularly from the 2021 Census and the 2019 Farm Census. It also includes regular data, such as the Monthly Wage Report and commuting movements between the municipality of employment and the municipality of residence obtained from the Lists of Personnel (workplace location). This latter data, combined with the Census data, allowed for a better allocation of Primary and Disposable Income of Households to the place of residence rather than the place of work, although its impact is more significant in the Mainland NUTS regions.

Regional Gross Domestic Product approaching 7 billion euros in 2023, with the highest real growth among NUTS2 Regions

In its first estimate for 2023, Statistics Portugal (INE) projects a GDP of 6,989.6 million euros for the ARM, reflecting nominal growth of 11.5% and real growth of 4.5% (i.e., excluding the effect of price changes) in the ARM. In the first case, only Grande Lisboa (+11.7%) surpassed the Autonomous Region of Madeira, but in the second, the ARM had the highest real growth among the 9 NUTS2 regions. The national average was +9.6% for nominal growth and +2.5% for real growth. Above the national average in real growth, alongside the ARM (+4.5%) and Grande Lisboa (+3.3%), are the Autonomous Region of the Azores (+3.4%), Algarve (+3.3%), and Oeste and Vale do Tejo (+2.9%). In real terms, the regions with the most modest performances were Alentejo (+0.4%), Centro (+1.4%), Peninsula de Setúbal (+1.7%), and Norte (+2.3%).

Indeed, except for "Information and communication" (-18.2%), which saw a sharp decline, the ARM’s performance reflects the favourable developments of the other nine sectors in the A10 economic activities breakdown.

By sector of activity, in 2023, the real growth in Gross Value Added (GVA) was notable in the "Financial and insurance activities" (+12.3%), "Agriculture, livestock production, hunting, forestry, and fishing" (+10.3%), "Professional, scientific technical and similar activities; administrative and support service activities" (+7.2%), "Mining and quarrying; manufacturing; electricity, gas, steam and air conditioning supply; water abstraction, purification and supply; sewerage, waste management and remediation activities" (+7.1%), and "Wholesale and retail trade; repair of motor vehicles and motorcycles; transportation and storages; accommodation and food service activities” (+6.7%). The latter sector remains the largest contributor to the regional GVA (35.1%).

The remaining four sectors grew below the regional average, with notable mention of "Public administration and defence; compulsory social security; education; human health and social work activities" (+4.1%), which contributes significantly to the GVA from the Public Administration institutional sector, accounting for 25.2% of regional GVA. The third-largest contribution came from real estate activities (9.3% of GVA), which grew by 3.8% in real terms.

Regarding GDP per capita, in 2023, it amounted to 27,369 euros in the region, above the national average of 25,277 euros. Grande Lisboa (39,942 euros) was the only region surpassing the ARM, while Algarve (27,303 euros), traditionally the second region with the highest GDP per capita, was surpassed by the ARM in 2023. In fact, these were the only three regions exceeding the national average, with Peninsula de Setúbal recording the lowest GDP per capita (17,069 euros), followed by Oeste e Vale do Tejo (19,603 euros), Norte (21,509 euros), and Centro (21,753 euros). Closer to the national average, but still below it, were Alentejo (23,910 euros) and the Azores (22,346 euros).

For the region, the disparity indices for GDP per capita compared to the national average (PT=100) and to the European Union average (EU27=100) were 108.3 and 87.2, respectively.

Regarding apparent labour productivity, which corresponds to the ratio between GVA and Employment, it stood at 47,684 euros in the ARM, above the national value of 44,820 euros.

It is worth mentioning that INE will present the final values for 2023 in about a year, and given the small size of the region’s economy, revisions may be significant.

Economic growth of the ARM in 2022 was revised upwards by INE to 16.5%

The final data for 2022 reveals that regional GDP reached 6,265.7 million euros, reflecting a nominal growth of 23.5% and real growth of 16.5% compared to the previous year. In a year still recovering from the COVID-19 pandemic, only Algarve outperformed the ARM, with real growth of 20.7%, followed by Grande Lisboa (+9.1%), making these three regions the only ones exceeding the national average (+7.0%). Alentejo recorded the least impressive performance (+1.7%), below Centro and Oeste and Vale do Tejo (+4.1% each), Norte (+5.2%), and the Azores (+6.3%).

The sectors that most contributed to the economic growth in 2022 were "Information and communication," whose GVA increased by 64.2% in real terms, ""Wholesale and retail trade; repair of motor vehicles and motorcycles; transportation and storages; accommodation and food service activities " (+36.0%), and " Professional, scientific technical and similar activities; administrative and support service activities" (+32.6%).

In 2022, the disparity indices compared to the national average and the European Union (EU27) average for the region were 106.1 and 82.1, respectively.

It is worth noting that the Gross Fixed Capital Formation (GFCF), the main component of investment in the ARM in 2022 amounted to 1,045.5 million euros, representing an 8.8% growth compared to the previous year, lower than the national growth (+13.1%).

Meanwhile, the Gross Disposable Income (GDI) of the ARM households increased by 11.4% in 2022, reaching 15,408 euros per capita, with a disparity index of 99.2 compared to the national average, meaning it was only 0.8 percentage points below the national average. By NUTS2 region, the leader in this indicator was Algarve (122.8), followed by Grande Lisboa (119.9) and Alentejo (100.6), the only regions exceeding 100. Close to the reference value were the Autonomous Regions of Azores and Madeira (99.2 in both cases) and Peninsula de Setúbal (99.0). Norte had the lowest performance (89.3).

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