In March 2022

Madeira’s economy continued to accelerate

The Regional Indicator of Economic Activity (RIEA) indicates that the economic activity of the Autonomous Region of Madeira, in March, reinforced the growth path compared to the previous month.

As mentioned in the first release of RIEA, in October 2017, its purpose is “to signal the behavior of economic activity, namely concerning its direction and magnitude of fluctuations: whether it is in the positive or negative ground, accelerations, decelerations and the identification of turning points”. Therefore, its quantitative value assumes secondary importance, not being a substitute for the volume change of the Gross Domestic Product - determined with a more varied and complete set of statistical information - although there is a strong correlation between the two variables.

Monthly Economic Survey - The economic situation of the Autonomous Region of Madeira in March 2022 by covering 6 topics

As in previous months, DREM releases a brief analysis of the main short-term indicators. It should be noted that many of the March 2022 indicators show an acceleration in growth, which is naturally due to the strong restrictions on economic activity in the corresponding period.

Economic activity

As mentioned above, RIEA shows that, in March 2022, the economic activity reinforced the growth trajectory, accelerating compared to the previous month, thus surpassing the values of the last 6 months.

The recovery of the tourism sector was an important contributor to this performance, with overnight stays (excluding local accommodation under 10 beds) increasing by 566.0% in the month.

Electricity distribution – an indicator associated with the performance of the economic activity – grew by 12.2% in March 2022. Also with an upward trend is the diesel released for consumption, which, in March 2022, grew by 23.8%, against the 19.6% recorded in February.

When analysing the ratio of incorporated and dissolved companies, it is noted that in March 2022, for each dissolved company in the Region, 1.4 new companies were incorporated, the same value as in January and February 2022, and reflecting a slowdown compared to the last 2 months of 2021 (3.5 in November and 2,2 in December).

Private consumption

One of the indicators that can be related to private consumption is the operations on the SIBS network with the cards issued by the national banks. Analysing the amounts of withdrawals and purchases through automatic payment terminals (APT) using this type of card, there is a robust growth of 16.4% in March 2022 (13.2% in the previous month), confirming the reversal of the deceleration trend that took place in January 2022.

The gasoline released for consumption also shows an upward trend, rising by 31.5% year-on-year (23.5% in February 2022).

In turn, the loans for consumption and other purposes granted to households and non-profit institutions serving households increased by 1.9% in March 2022.

Investment

The available indicators for the investment domain, with the exception of licensed buildings, are growing in March 2022, with an emphasis on cement sales (+19.9%). Housing loans grew by +2.0% and bank appraisals by 9.7%. On the contrary,  licensing for new buildings decreased by 3.1%.

External demand

Although trade with foreign countries represents only a small part of the Region's total trade (the majority of it is with the mainland), it should be noted that both exports (+43.8%) and imports of goods (+47.2%) show the same trend as the movement of goods in ports (+31.7%), the most comprehensive indicator of the dynamism of trade with foreign countries. Among the indicators more related to the export of services, the growth of passengers in airports (+431.6%) is in line with withdrawals and purchases through automatic payment terminals (APT) with international cards, which grew by +141.7% in March 2022 (+89.6% in the previous month).

Labour Market

Data from the organisations responsible for employment in the country and the Region show, in March 2022, an increase in job offers (+100%) and a decrease in both job applications (-4.4%) and registered unemployed (-5.3%).

Prices
In February 2022, the year-on-year inflation rate accelerated, reaching 5.0%, more pronounced for goods (+6.1%) than for services (+3.3%). The underlying inflation rate (excluding unprocessed food products and energy, the latter with a price increase of about 16.3%) was 4.0%.

For more information, please click on:

• RIEA - In Focus (Portuguese only)

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