Portugal has second largest budget surplus in Eurozone

 In Economy, News

Portugal managed to have the second largest budget surplus out of all 28 Eurozone countries according to the EU statistical agency Eurostat.

The budget surplus was 3.6% at the time of the third quarter of 2018. However, Portugal’s public debt was still high at 125% of GDP.

Portugal’s public debt was the third worst in the EU.

The only country in the EU that did better than Portugal in terms of the 2018 budget was Malta with a surplus of 3.8% and with a positive budgetary balance of 3.6% which it shares with Bulgaria.

In November last year Portugal’s parliament approved a deficit-shrinking 2019 budget which aims to nearly eliminate the deficit and further reduce Portugal’s debt burden which is one of the highest in Europe.

At the end of 2018 the government paid of its €78Bn loan from the IMF Troika, paying the remaining €4.6Bn lent in 2011.

The effective if not actual coalition government of António Costa’s socialist PS party has, with the support of far left-wing parties in parliament (the so-called ‘Geringonça’ or ‘Jalopy’) managed to combine tax improvements with growth supporting policies while reversing many unpopular austerity measures imposed by the EU/IMF bailout programme.

Portugal is seen by Brussels as the “good pupil” of Europe in sharp contrast to Italy which has widened its budget deficit bringing widespread criticism from EU leaders while scaring investors.