In May 2023
Economic activity in the Autonomous Region of Madeira continued to expand, albeit with a slight deceleration
The Regional Economic Activity Indicator (RIEA) reveals that in the month of May 2023, the regional economic activity continued its positive growth trajectory, albeit with a slight deceleration compared to the previous month.
As previously mentioned, the primary purpose of the RIEA, as indicated by the DREM in its initial release in October 2017, is to "signal the behaviour of economic activity, particularly with regard to its direction and magnitude of fluctuations: whether it is in a positive or negative trend, accelerations, decelerations, and identifying turning points." Therefore, its quantitative value assumes secondary importance, as it is not intended to substitute for the actual change of the Gross Domestic Product, which is determined through a broader and more comprehensive set of statistical data, even though a strong correlation exists between the two variables.
Monthly Economic Survey - The economic situation of the Autonomous Region of Madeira in May 2023 from 6 topics
DREM presents a brief analysis of the main short-term indicators, broken down by themes.
Economic Activity
As mentioned above, regional economic activity in May 2023 continued its positive growth trajectory, albeit at a slower pace than the previous month.
The performance of the tourism sector significantly contributed to economic growth, with overnight stays (excluding local accommodations below 10 beds) increasing by 10.8% in that month, although less than the 24.1% recorded in the previous April. A similar trend is seen in revenue per available room (RevPAR), which grew by 27.0% (compared to 39.3% in April).
Electricity distribution, which is often associated with economic activity, experienced a growth of 0.2% in May 2023, which was lower than the growth rate in the previous month (+0.6%). In a reversal of the previous month's trend, where there was a decrease of 3.1%, diesel consumption experienced a growth of 0.8% in the reference month.
Regarding the relationship between incorporated established and dissolved companies, it is observed that in May 2023, there were 2.1 new companies incorporated for every company dissolved in the region, a proportion lower than that of the previous month (2.4).
Private Consumption
One of the indicators reflecting the evolution of private consumption pertains to operations within the SIBS network using cards issued by national banks. When considering the aggregate amounts of ATM withdrawals and purchases through automated payment terminals using national cards, a growth of 11.4% was observed in May 2023.. However, this growth rate decelerated compared to the previous month.
Gasoline release consumption accelerated, with the year-on-year change reaching +18.5% in May 2023, compared to +14.2% in the previous April.
Consumer loans granted to households and non-profit institutions serving households have been experiencing negative changes since June 2022, a trend that persisted in May 2023, with a decrease of 19.6%.
In May 2023, the sale of new light passenger vehicles continued to grow (+34.8%), albeit at a slower pace than the previous month (+86.6%).
Investment
While loans granted to households for housing exhibited a slight increase (+0.3%, compared to +0.7% in April), and housing bank appraisals showed positive growth (+17.0%, compared to +16.3% in the previous month), other indicators in the investment domain declined in May 2023. The balance of loans granted to non-financial corporations decreased by 1.8% (compared to a decrease of 4.7% in the previous month), cement sales decreased by 2.9% (compared to a decrease of 3.9% in April), and building permits saw a decline of 9.0% (compared to a decline of 9.4% in the previous month).
External Demand
While foreign trade constitutes only a small portion of the overall trade conducted by the Region (most of which is with the mainland), it is worth noting that exports (+3.9%) grew and imports of goods (-6.4%) declined. The movement of goods in ports (+11.9%; +6.7% in the previous month), which serves as a more comprehensive indicator of external trade dynamics, increased. Among other indicators, in May 2023, the slowdown in passenger traffic at airports (+21.6%; +39.3% in April) is consistent with the evolution of the aggregate amounts of ATM withdrawals and purchases through automated payment terminals using international cards (+23.5%; +32.0% in the previous month).
Labour Market
Data from employment authorities both at the national and regional levels indicate that in May 2023, there was a decrease in job offers (-29.9%), whereas job applications increased (+10.5%), and the number of registered unemployed persons throughout the month saw a rise (+10.6%).
Prices
In May 2023, the year-on-year inflation rate stood at +4.4%, showing a deceleration compared to the previous month (+6.6%). This rate remained consistent for both goods and services, at +4.3%. The underlying inflation rate, which excludes unprocessed food and energy products, was +5.0%, marking a decrease from 7.1% in April.
For further information, please refer to: