Portugal’s budget performance in 2013 “in line” with financial bailout programme

20 February 2014

Portugal’s budget performance in 2013 “is in line” with its financial bailout programme, said the International Monetary Fund (IMF), which expects the budget deficit target, of 5.5 percent of gross domestic product (GDP), had been “comfortably reached.”

In the report on the 10th assessment of the Economic and Financial Assistance Programme (PAEF), published Wednesday the IMF said it hoped that, “the target for 2013 has been reached with some margin,” which it explains through “a recovery of tax revenues.”

“Tax collection in November exceeded projections of the authorities by 336 million euros (0.2 percent of GDP) and additional measures to offset budget overspending identified in the eighth and ninth reviews were successfully applied in the second Budget Amendment that was approved in November last,” said the IMF.

In the State Budget for 2014, presented in October 2013, the government reviewed its projection for the budget deficit in 2013 to 5.9 percent, which is higher than the 5.5 percent of GDP target agreed with the commission made up of the IMF, the European Commission and the European Central Bank.

In the same document the IMF said that unemployment remained high, but pointed to a rate of 16.8 percent in 2014, which is an improvement on the 17.7 percent rate in previous reviews.

After reaching a peak at the end of this year, unemployment will start falling to 16.5 percent in 2015 (17.3 percent in the previous review of the memorandum) and only in 2018 will it fall to below 15 percent, with the IMF pointing to a rate of 14.8 percent. (macauhub)