Moody’s praises Portugal’s reforms

The international ratings agency Moody’s has given the thumbs up for Portugal’s performance in terms of growth potential and reforms.

The agency said on Friday said that Portugals positive outlook reflected “economic, tax and banking reforms”.
According to Moody’s the positive outlook reflects “significant public and private investment together with additional structural reforms within the context of Next Generation EU, a programme of EU funding to modernise EU member state economies and includes the Recovery and Resilience Plan (RRP), and for cementing progress in terms of economic reforms and fiscal consolidation over the past decade”.
The financial rings agency estimates that there has been real GDP and potential growth boost because of the RRP.
Portugal should gain an extra 0.5% real GDP to 2026 and a further 0.3% to 2030. Moody’s also points out that Portugal’s debt to GDP over the past three years has fallen over the past two years, but Portugal’s debt continues to be stubbornly high by international standards.
In relation to 2019, the percentage of debt to GDP fell three percent points in Portugal. The main risks for the future for Portugal include drought, heatwaves and rising sea levels. Migratory flows should ensure an increase in Portugal’s population.

Image: EPA/ANDREW GOMBERT