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Statistical Press Release – International Investment Position – December 2020

Today, Banco de Portugal publishes statistics, in Table A.18 of the Statistical Bulletin and in BPstat, on the international investment position (IIP) for December 2020.

At the end of 2020, Portugal’s IIP stood at -€213.3 billion, reflecting a reduction in the negative position of around €1.6 billion compared with the end of 2019 (Chart 1).

For more detailed information on transactions, see Statistical Press Release on the Balance of payments.

The change in the IIP resulted from the positive contributions of transactions (+€0.8 billion), price changes (+€3.3 billion) and other adjustments (+€1.8 billion), which were partially offset by exchange rate changes (-€4.3 billion). 

The exchange rate changes, were mainly justified by the depreciation of the American dollar, and also of the Brazilian real and the Kwanza, with impact on the reduction of the value in euros of the assets (capital) held by residents and expressed on those underlying coins. 

Regarding price changes, it is worth noting, on the assets component, the appreciation of the Central Bank gold and, on the liability component of the IIP, the depreciation of equity securities in non-resident portfolios.

The other adjustments were mainly justified by the dissolution of resident companies held by non residents.

Despite the nominal reduction of the negative IIP position, as a percentage of GDP1, it was observed an increase in that position by 4.7 percentage points (p.p.), from 

-100.8 per cent at the end of 2019, to -105.5 per cent at the end of 2020. This variation was mainly due to the GDP contraction.    

The net external debt of Portugal, which is the result of the IIP mostly excluding capital instruments, gold bullion and financial derivatives, stood at €176.8 billion in the end of 2020. As a percentage of GDP, the net external debt increased by 3.1 p.p. between the end of 2019 and 2020. The net external debt changed from 84.4 per cent to 87.5 per cent of GDP (Chart 2).

Next update: 19 May 2021


Note

1 The nominal GDP figures used for the calculation of the ratios are published by Statistics Portugal (Instituto Nacional de Estatística – INE). For the latest quarter, and when such figures are not available, the nominal GDP of this quarter is extrapolated, based on partial information disseminated by INE. Therefore, the estimate takes into account the GDP of the same quarter of the previous year, the published year-on-year rate of change in volume for the latest quarter, and the last published figure for the year-on-year growth rate of the GDP deflator. For the series on stocks, the nominal GDP used in the calculation of the ratios corresponds to the accumulated GDP of the last four quarters, regardless of the quarter to which it relates.