In April 2024

Regional economic growth accelerated

The Regional Indicator of Economic Activity (RIEA) reveals that in April 2024, the regional economic activity strengthened its growth trajectory after five consecutive months of deceleration.

As previously mentioned, the primary purpose of the RIEA, as indicated by the Regional Directorate of Statistics of Madeira (DREM) in its initial release in October 2017, its objective is “to signal the behaviour of economic activity, particularly with regard to its direction and magnitude of fluctuations: whether it is in positive or negative territory, accelerations, decelerations, and the identification of turning points.” Therefore, its quantitative value assumes secondary importance and is not intended as a substitute for the real change of the Gross Domestic Product, which is determined with a broader and more comprehensive set of statistical information, even though there is a strong correlation between the two variables.

Economic Overview for April 2024 - 7 Key Themes

DREM provides a concise analysis of major short-term indicators, often utilising three-month moving averages to smooth irregularities and highlight trends.

Economic Activity

As previously mentioned, the regional economic activity in April 2024 reinforced its growth trajectory after five consecutive months of slowdown. The performance of the tourism sector contributed to economic growth, as overnight stays (excluding local accommodation with fewer than 10 beds) increased by 3.5% in April, up from 2.4% in the previous March. It is also noteworthy that total revenue in tourist accommodation increased by 11.9% (10.8% in the last March).

Electricity distribution, an indicator usually associated with economic activity, grew by 3.2% in April 2024, higher than the 2.7% recorded in the previous month. Diesel consumption grew by 2.2%, after decreasing by 0.2% in the previous March.

Analysing the ratio between incorporated and dissolved companies, it is observed that in April 2024, 3.0 new companies were incorporated for every company dissolved in the Region, a higher proportion than in the previous month (2.4).

Qualitative Indicators

Considering a 3-month moving average, the confidence indicators available for April 2024, compared to the previous month, show an increase in the manufacturing and services sectors, and a decrease in the construction and trade sectors.

Private Consumption

One of the indicators revealing the evolution of private consumption refers to the operations of the SIBS network, with cards issued by national banks. Observing the total amounts withdrawn from ATMs and purchases made through automatic payment terminals with national cards, there was a 7.4% growth in April 2024 (6.4% in the previous March).

Gasoline released for consumption slowed, with the year-on-year change growing by 10.9% in April 2024, after having increased by 8.6% in the previous March. Meanwhile, purchases of new light passenger cars by residents decreased by 15.3% (-24.4% in the previous month).

The balance of loans granted to households and non-profit institutions serving households decreased by 13.3% in April 2024, after having fallen by 13.7% in the previous month.

Investment

Regarding Investment, the indicators for April 2024 are divided into two groups: those showing positive signs, such as sales of light commercial vehicles (9.8%; 17.3% in the previous March), bank appraisals on housing (17.8%; 18.5% in the previous month), building permits (22.2%; 21.7% in the previous month), and cement sales (10.7%; -3.1% in the last March); and those in decline, such as the balance of loans granted to households for housing (-0.7; -0.9% in the previous March) and the balance of loans granted to non-financial companies (-7.7%; -6.8% in March 2024).

External Demand

Although foreign trade represents only a small portion of the total trade conducted by the Region (most of which is with the Mainland), it is important to note that both exports (-1.5%; -13.5% in the previous March) and imports of goods (-15.2%; -21.7% in the previous month) decreased. The movement of goods in ports (3.5%; -1.6% in the previous month), which is a more comprehensive indicator of the dynamics of foreign trade, accelerated compared to the previous month. In other indicators, in April 2024, the acceleration in passenger movements at airports (3.6%; 2.1% in the last March) is in line with the evolution of total withdrawals from ATMs and purchases through automatic payment terminals with international cards (12.5%; 9.0% in the previous month).

Labour Market

Data from employment agencies in the country and the Region show that in April 2024, there were reductions in job offers (-32.0%), job applications (-1.4%), and registered unemployed throughout the month (-1.5%).

Prices

In April 2024, the year-on-year inflation rate, which stood at 3.0%, accelerated compared to the previous month (2.4%), being lower for Goods (1.6%) and higher for Services (4.8%). Underlying inflation (which excludes unprocessed food and energy products) was 3.3%.

For more information, visit:

• RIEA - In Focus (Portuguese only)

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