Monday, May 27, 2024

Portugal forecast to see solid job growth, high economic activity

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Portugal is projected to see “solid employment growth” and a “high level” of economic activity, the European Commission said on Thursday, downplaying a slight downward revision to its forecast for the country’s GDP in 2024, which it stressed was in line with a slowdown in GDP growth across the eurozone.

“Of course, there are challenges, but we see solid growth in employment in Portugal and, in the overall picture… the fact that the European Union has avoided recession is positive, as is the fact that some countries like Portugal continue to register a high level of growth” in GDP, said Economy Commissioner Paolo Gentiloni.

Speaking at a press conference in Brussels on the day that the institution’s winter economic forecasts predicted economic growth for Portugal of 1.2% in 2024 and 1.8% in 2025, Gentiloni explained that the slowdown in the Portuguese economy was linked to the “slowdown in the region as a whole”.

Nevertheless, Portugal’s GDP “is still growing at a strong pace”, he said in response to questions from Lusa.

Asked about farmers’ protests in Portugal and other EU countries, the commissioner said he did not see “any disruption to the supply chain as a result of this situation on the horizon”.

“As a Commission, we are listening and acting on the questions we hear from farmers,” he added.

The European Commission now expects Portugal’s GDP to grow by 1.2% in 2024, a downward revision of a tenth of a percentage point for this year but above the average for the eurozone and the European Union as a whole, and by 1.8% in 2025.

However, in its winter economic forecasts, the Commission expects Portugal to suffer the second-largest slowdown in GDP growth among euro-area countries between 2023 and 2024 (by 1.1 percentage points), surpassed only by Malta (by 1.5 percentage points).

The EU executive sees Portugal’s GDP growth rate almost halving from 2.3% in 2023 to 1.2% in 2024, compared with 1.3% growth in 2024 in its autumn forecast.

Also on Thursday, for the third time in a row, the commission downgraded its growth forecast for the eurozone as a whole to 0.8% this year.

It also cut its forecast for the EU to 0.9% – describing this as “modest growth” but predicting that it will accelerate in 2025.

(Ana Matos Neves | Lusa.pt)

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