European Commission revises economic growth forecast for Portugal upwards

6 February 2015

The European Commission has revised upwards its economic growth forecast for Portugal this year, now estimating that GDP will grow by 1.6 percent, or slightly more than predicted in December and higher than government forecasts, according to the EC Winter forecasts.

In the document issued Thursday in Brussels the forecast is higher by 10 basis points than the projection included by the government in the State Budget for 2015 and by 20 basis points compared to the first post-adjustment programme evaluation, published in December.

The Commission also slightly increased the forecast rise in gross domestic product (GDP) last year, from 0.9 percent to 1 percent, in line with the rate expected by the Government.

Brussels highlights the “modest recovery” of the economy and of Portuguese public finances, predicting that this improvement will continue in line with a gradual improvement in financing improvements and external demand.

According to the forecasts published Thursday, the European Commission expects Portugal’s budget deficit to reach 3.2 percent of GDP in 2015, which represents a “slight improvement” compared to the previous forecasts in which Brussels pointed to a deficit of 3.3 percent this year.

However, this estimate is still less optimistic than that of the government, which provides that the budget deficit will be 2.7 percent this year, two tenths more than the figure agreed with international creditors during the bailout programme. (macauhub/PT)