The Portuguese government welcomed the decision of the European Commission to publicly recommend «the Council to abrogate the Excessive Deficit Procedure (EDP) for Portugal».
«Portugal has worked hard to achieve this outcome, and will continue to work hard to keep improving its prospects. This decision is a turning point in so far as it expresses the Comission’s assessment that Portugal’s excessive fiscal deficit has been corrected in a sustainable and durable way», wrote the Finance Ministry in a note.
Last year, Portugal reached a fiscal deficit of 2.0% of GDP, the lowest since 1975. For 2017, the deficit is expected to be further reduced to 1.5%, and the primary surplus will reach 2.7 %, the highest in the EU. Portugal is projected to reach its fiscal medium term objective by 2021.
The Commission’s decision comes in the wake of a growth rebound since the third quarter of 2016, which is now above EU average; a steep reduction in unemployment, back to single digit; and a methodical approach to fixing the banks’ legacy problems. It also reflects the structural change and rebalancing of the Portuguese economy: the current and capital account surpluses, the private sector deleveraging, and the sound fiscal consolidation process.
«The Portuguese Government is fully committed to continuing the implementation of ambitious reforms, aiming at increasing potential growth and ensuring sustainable and inclusive economic prosperity. Portugal will continue to fulfil its commitments», added the Finance Ministry.