Medina: New predictions from Brussels are good news for Portugal in an adverse context – Conjuntura

The Minister of Finance, Fernando Medina, defended this Monday that the new economic forecasts of the European Commission are “good news” for Portugal and that, if they come to fruition, they could allow the Government to go further in easing the tax burden. about the Portuguese in the coming years.

“This is good news for the Portuguese economy that allows us to face the current adverse context, with higher inflation than we would like and in which there are several extracts of the Portuguese population that need support and attention from the State”, said the Minister of Finance, in statements to journalists in Brussels, transmitted by RTP3.

At issue is the fact that the European Commission has revised upwards the growth estimates for Portugal. Brussels now predicts that the Portuguese economy will grow by 2.4% this year and that the deficit will be reduced to 0.1% of GDP, thus proving to be more optimistic than the Government in the estimates that it sent to Brussels in the Stability Programme.

Fernando Medina underlined that these forecasts put Portugal growing “more than double the estimate for the Euro Zone economies” this year. In addition, Brussels’ expectation that inflation will slow down to 5.1% this year and decrease to 2.7% in 2024 is “lower than expected” and is “very much in line with the Government’s forecasts” and employment is, according to Fernando Medina, “on the rise”.

“Basically, it is a stronger economy that has allowed us to develop policies to support the most vulnerable, to consolidate our welfare state and to keep our accounts straight. -us [apoiar as famílias, sobretudo as mais carenciadas,] with efficiency and attention, with the objective of collectively going through this moment and continuing to converge with the most developed countries in Europe”, he highlighted.

Improvement of the budget balance allows the IRS to go further

The minister also pointed out that, according to the European Commission, Portugal should succeed during the year 2023 to stop being “the country with the third highest debt, moving to the fifth position, below Spain and France”.

“Let’s not have any doubts: it was the good budgetary management that was carried out that ensured not only good results from the point of view of the deficit, but also, by ensuring a support package with a very large dimension in 2022, it is contributing to a growth of the internal demand above what were the originally expected values”, he said.

Fernando Medina stressed that, with the reduction of the public debt and the budget deficit closer to zero, Portugal will achieve “a soundness and confidence to take the steps announced in the Stability Programme”, including an easing of the tax burden, with “a IRS refund”.

“If the projections for the Portuguese economy materialize, this will allow us to face the 2024 budget year and the following years in a more solid way”, he said.

He underlined, however, that it is necessary to “always bear in mind that it is necessary to take steps that are compatible with the leg”. “We cannot take measures of a structural nature in the country, such as fiscal or expenditure measures, that do not allow us to be sure that in any situation we can comply with them. We have to be prepared so that in an adverse scenario we can always be safe. That has been the case. a major priority for the Government”, he concluded.