Government forecasts growth of 1.8% this year and 2.1% in 2025
The Government forecasts a growth of the Portuguese economy of 1.8% this year and 2.1% in 2025, according to the macroeconomic scenario of the State Budget for 2025 (OE2025) delivered on Thursday in Parliament.
The outlook means a slight downward revision for 2024 and upward for 2025 from the 2% for both years signalled to political parties at the budget proposal negotiation meetings.
In the Stability Programme, in a scenario of invariant policies, the Ministry of Finance pointed to a growth rate of 1.5% this year and 1.9% in 2025, but throughout the year indicated that it was working with a scenario of about 2%.
After meetings in September with political parties, the National Institute of Statistics (INE) started a new statistical series, incorporating new information, which led some institutions to review the prospects for this year downwards.
The forecast for this year is in line with that of the Public Finance Council (CFP), but is above the 1.6% expected by Banco de Portugal (BdP) and the Organization for Economic Cooperation and Development (OECD) and the 1.7% predicted by the European Commission. The International Monetary Fund (IMF) is more optimistic and expects an expansion of 1.9%.
For 2025, the Executive’s forecast is in line with that of the Bank of Portugal led by Mário Centeno, but is below the 2.4% expected by the CFP and the 2.3% by the IMF. For its part, the OECD points to a rate of 2% and Brussels of 1.9%.
The Ministry of Finance supports the 2025 outlook with accelerating domestic demand (from 2% in 2024 to 2.1% in 2025), in particular investment (from 3.2% in 2024 to 3.5% in 2025) and private consumption (from 1.8% to 2%), and exports (from a rate of 2.5% to 3.5%). “The growth of the Portuguese economy should remain above the growth of the euro area,” says the budget report.
Photo: Portuguese Minister of State and Finance Joaquim Miranda Sarmento speaks to the journalists during a press conference about the 2025 state budget at the Finance Ministry in Lisbon, Portugal, 10 October 2024. EPA/ANTONIO PEDRO SANTOS
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