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Troika points to “risks and uncertainties” in Portugal’s deficit

Subir Lall and his largely inscrutable team from Portugal’s troika of lenders has yet again sounded warnings over the country’s deficit.

Leaving Lisbon after a week-long visit, the bottom line is that the European Commission and the European Central Bank point to “significant risks and uncertainties” that they consider will “persist to the end of the year”.

The PS government’s forecasts of attaining a 2.2% deficit are still seen as unrealistic, with a more likely result being in the region of 3%, say the analysts – who have asked for an “exhaustive revision of expenditure”, stressing that banks need “special attention”.

Another sticking point for the troika was Portugal’s continued high rate of unemployment, particularly when it comes to young people – and the fact that this government is committed to increases to the national minimum wage, which the troika has always been against.

In the aftermath of Brexit and with chaos and uncertainty now throughout the European community, Portugal’s government has barely bothered to respond.

A source from the Ministry of Finance has simply reaffirmed Portugal’s commitment to “levels stipulated within the State Budget” and said it has “taken note of the points raised”.

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