Growth of the gross domestic product in the last quarter of last year was the weakest since the end of 2019 (excluding the Covid years) although it was still far stronger than most European countries.
The National Statistics Office said provisional estimates showed that the Gross Domestic Product (GDP) for the fourth quarter of 2023 amounted to €4.9 billion, an increase of €418.6 million, or 9.3 per cent, when compared to the same quarter of 2022. In volume terms, GDP rose by 4.3 per cent
The GDP deflator went up by 4.8 per cent compared to the same quarter last year. This represents a decrease of 0.6 percentage points in comparison to the year-on-year rate recorded in the third quarter of 2023.
Graphic: National Statistics Office.The production approach
During the fourth quarter of 2023, Gross Value Added (GVA - the difference between the value of output and the value of intermediate consumption, and taxes less subsidies on products) rose by 5.1 per cent in volume terms, when compared to the corresponding quarter of 2022.
The contribution to the GVA growth rate in volume terms of Service activities , Industry and Agriculture and fishing were all positive and stood at 4.3 percentage points, 0.7 percentage points and 0.1 percentage points, respectively.
The increase in service activities was mainly driven by the growth rates recorded in the following sectors: Administrative and support services activities (22.9 per cent), Accommodation and food service activities (15.3 per cent) and Financial and insurance activities (6.7 per cent).
Domestic demand had a negative contribution
The expenditure approach to calculate GDP showed that domestic demand had a negative contribution of 4.0 percentage points to the year-on-year GDP growth rate in volume terms, the NSO said. Conversely, the external demand registered a positive contribution of 8.3 percentage points.
In the fourth quarter of 2023, final consumption expenditure increased by 7.2 per cent in volume terms. This was the result of increases in private final consumption and general government final consumption of 7.3 per cent and 7.1 per cent, respectively.
Gross fixed capital formation declined by 30.4 per cent in volume terms. This decrease was mainly attributable to lower investment in Transport equipment compared to 2022.
Exports and imports of goods and services in volume terms rose by 7.4 per cent and 2.4 per cent, respectively.
The income approach
The income approach, which shows how GDP is distributed among compensation of employees, operating surplus of enterprises and taxes on production and imports net of subsidies showed that compared to the fourth quarter of 2022, the €418.6 million increase in nominal GDP was the result of a €138.0 million increase in Compensation of employees, a €266.3 million rise in Gross operating surplus and mixed income, and an increase of €14.3 million in Net taxation on production and imports.
Compensation to employees. (Graphic: NSO)