Historic deficit: Portugal “almost at zero”

It’s just the news the country needs as everyone clocks off for Christmas in this bipolar year.

In spite of historic loss of life and property in public calamities recently, Portugal has pulled the rabbit out of the hat when it comes to the country’s deficit.

Say reports today the period July to September ended with a deficit of just 0.3% of GDP. It’s almost zero, said the lunchtime news.

Set against the same period last year when the deficit stood at 2.8% it is “a significant fall”, and the PS Socialist government is certainly making the most of it.

INE, the national statistics institute, explains the result “owes itself to a strong increase in receipts” (ie tax income) versus the government spending less.

And that last factor is the issue for many, as inland areas cry out for public investment.

But for now, the government appears to be basking in economic glory. President of the Republic Marcelo Rebelo de Sousa has affirmed that “this year we going to have a deficit that won’t be leaving the finance minister trembling”.

It won’t remain at 0.3% for the year end, however.

Prime minister António Costa says the last three month period will likely bring totals in at around 1.3%, which is still lower than the government’s own estimates of 1.4%.

Negocios online adds that this is very much the scenario traced by UTAO, the public accounts watchdog, which predicted “pressures” for the period September-December that would bring the deficit back in line with public administration objectives.

Even so, it’s good news as Portugal’s finance minister Algarve-born Mário Centeno (pictured above) takes a break from the hotseat to enjoy Christmas with his family before taking up the presidency of the Eurogroup.

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