Public debt below 100% of GDP

 In News, Public debt, Public deficit and Budget deficit

Portugal’s Finance minister, Fernando Medina is to mount a special operation to bring Portugal’s public debt down to 100% of GDP before the elections.

The health sector is one of the areas involved with the government to authorise the injection of €1.2Bn to pay off National Health Service (SNS) debts.
This special operation also involves the purchase of public bonds from private companies, insurers, and banks, as well as the early redemption of public company bonds with a plan to close 2023 with a public debt below 100% of GDP according to newspaper Expresso.
According to the weekly publication, regarding the repurchase of debt in the form of bonds from private companies that would have matured at a later date, the operation could involve up to €3Bn.
To this is added the normal cash injections paid to SNS suppliers and the payment of public company debts, which while not revealed, is “considerable”.
In terms of heath, the government has authorised via two dispatches signed by the Ministries of Heath and Finances, the extraordinary payment of €1.2Bn to the SNS to pay debts.
In a first dispatch, authorisation was given to pay €650 million in debts to suppliers through factoring. On Friday a fresh dispatch was signed for €550 million for public companies within the SNS to pay outside suppliers.
In October, the government had estimated that the public debt stood at 103% of GDP in 2023, but through this special operation Medina’s goal is to get that amount down to below 100% of GDP. The final figures will be published by the Bank of Portugal in February.
In November, Portugal’s public debt fell to its lowest level in 3 years, at €267.9Bn.