Public debt down to 113.8% of GDP in 2022

Portugal’s Minister of Finance may have a major headache on his hands over controversies at Lisbon City Council and over airline TAP, but Fernando Medina does have reasons to be cheerful when it comes to the nation’s debt.

The former Mayor of Lisbon now charged with balancing the Government’s books announced a reduction in public debt on Tuesday to 113.8% of GDP in 2022.
It was the lowest since 2010, below even the Government’s forecasts, and even those of the Bank of Portugal. Medina told parliament that it “gives the Government more room for manoeuvre”.
“I can today announce that public debt in Portugal has fallen to 113.8% of GDP to pre-pandemic levels – levels not seen since before the troika in 2011. It is an remarkable fall of almost 12%, from the 125.4% that had been recorded in 2021 to the lowest level since 2010”, Medina told the Budget and Finances Commission.
He told MPs that the result was “super important” for the country and “gives us more room for manoeuvre”.
From an economic point of view, Medina pointed out that Portugal had not gone into recession despite the less than favourable International economic situation.
“On the contrary, we have grown more, and today we are 3.3% above the level of (economic activity) that we had in 2019”, he said.
On Tuesday, Portugal’s National Statistics Institute (INE) confirmed that the economy had grown 6.7% in 2022.
Medina also announced that the Government had started the year with a financial surplus of €2.013Bn in public administration finances.
The figure was a €184 million improvement in relation to the same month in 2022 with a “healthy jobs market” being partly behind the improvement.

Photo: Lusa – Miguel A. Lopes.