Public debt “up €9.5 billion” but growth “accelerating”

In another week of ‘swings and roundabouts’ economic news, Wednesday ended with the ‘shock’ that Portugal’s public debt has leapt €9.5 billion since the government ‘turned the page on austerity’ late in 2015, set against assertions by prime minister António Costa that the lukewarm national recovery is “accelerating”.

Addressing the inauguration of the new Lisbon headquarters of Spanish bank Santander Totta, Costa stressed that in the last few months of 2016, growth in Portugal was “the highest of the whole European Union”.

“We’re assisting in balanced growth in internal and external markets and also in consumption and investment”. Companies are investing, and “employment data is very clear”, he said.

“An unemployment rate of 10.2% (in December) signifies a reduction of more than two percentage points through 2016. In liquid terms, 100,000 jobs were created”.

Reports added that Costa “also referred to the drop in the budgetary deficit, affirming that ‘today it is certain that the deficit for 2016 will not be more than 2.3%. That is the lowest deficit in the last 42 years”.

Thus the revelation hours later that public debt had leapt €9.5 billion has somehow jarred with this rose-tinted perspective.

SIC television news, nonetheless, spent little time on it. “The country’s debt thus continues to increase and is very much higher than the wealth produced”, said the short report.

The new debt level is “only not even higher, because last year Portugal made an early-bird repayment to the IMF, so reducing debt levels”, the station concluded.

Other media sources too simply reported the situation, without suggesting what it might mean for the country’s future.

In ‘brutal terms’, Observador explains, public debt at the end of 2016 had reached 241.1 billion euros.

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