Portugal’s total debt climbs to €777.4Bn

Portugal’s total economic debt – State, companies and personal — has soared to a massive €777.4Bn, up €3.4Bn according to statistics published by the Bank of Portugal on Thursday.

Total debt for Portugal’s economy (except the financial sector) increased by €3.4Bn, while public sector debt rose by €2.9Bn. Private sector debt (companies) increased by a more modest €0.6Bn, largely more contained because of the financial support packages provided through the banks by the government throughout 2020 and 2021.
It set a new record for indebtedness for the Portuguese economy, a situation which may be aggravated by the fact the cost of borrowing money on International markets through 10-year bond issues has also now increased by nearly 2%.
However, in terms of the percentage of GDP, the impact of this debt had fallen after the Covid-19 pandemic reached its peak. The ratio fell 375.4% of GDP in 2020 to 363.3% of GDP in 2021, far from the 420% recorded in the Great Recession and Sovereign Debt crisis (2008-2014).
In the case of the public sector, in February debt had increased by €2.9Bn to €348.8Bn. The public administration and public companies (Parpública) had seen their debt to the financial sector increase by €1.4Bn and overseas by €1.3Bn.
In the case of the private sector for February, debt increased by €600 million to a total of €428.6Bn. That debt increase is split between €200 million for private companies and €400 million for individuals/families, although the “increase in debt was mainly to the financial sector”.
Regarding private companies, debt grew 4.3% compared to February 2021 “corresponding to a slowdown of 0.5 percentage points (pp) in relation to the previous month.
Personal debt continued to rise, increasing 3.7% in-like-for-like terms on the 3.4% in January.