THE MINISTER of Finance, Fernando Teixeira dos Santos, said last week that’s Portugal’s Gross Domestic Product will grow 1.5 per cent in 2008.
The rate is 0.7 per cent less than the government’s original forecast, which predicted a growth rate of 2.2 per cent.
It means that Portugal as a whole will lose out on just over three million euros a day in total earnings.
The admission was made after the National Statistics Institute released figures that showed Portugal’s economic activity had shrunk by 0.9 per cent in the first quarter of 2008.
The figures are disappointing for the government after the economy managed to grow at 1.8 per cent in the last quarter of 2007 thanks in part to increased export orders and the success of small and medium companies abroad.
Fernando Teixeira dos Santos said that growth predictions of 1.5 per cent in 2008 and 2.0 per cent in 2009 still affirmed his belief that the Portuguese economy would continue to grow and react favourably despite difficult world economic conditions, especially in the companies sector.
In 2007, Portugal’s GDP grew by 1.9 per cent, to 163 billion euros, while this year, if growth rates reached 2.2 per cent, Portugal’s wealth would increase by 9.8 million euros per day.
However, the latest revisions to the country’s projected economic growth at 1.5 per cent mean a daily expansion on 6.7 million euros – 3.1 million euros down on what had been originally forecast.
“This is bad news at a time when many people are losing their jobs and there are already difficulties being caused by an increase in food prices,” said President Cavaco Silva reacting to the latest forecasts.
Cavaco Silva added, “We need to pay special attention to those in our society that are being particularly hard hit by this economic crisis that has come from outside Portugal.”
However, the President said it was doubly important now to continue with efforts to modernize the Portuguese economy.