Portugal’s GDP to Slow in ’24 – IMF

Portugal’s GDP is expected to slow to 1.9 per cent in 2024, down from 2.3 per cent in 2023, according to the International Monetary Fund’s (IMF) consultation article.

Inflation, measured by the Harmonised Consumer Prices Index (HICP), is projected to ease significantly to 2.5 per cent in 2024, down from 5.3 per cent in 2023. Despite these forecasts, Portugal’s economy remains robust, driven by strong private consumption, net exports, and investment supported by EU funds.

Portugal achieved a substantial fiscal surplus and reduced its public debt to 99 per cent of GDP in 2023, a decrease of 36 percentage points since 2020. The debt is projected to fall further to 94.5 per cent of GDP in 2024.

The IMF commended the country’s recovery from global shocks but highlighted long-standing challenges, including low productivity, an ageing population, and subdued investment.

The IMF encouraged Portugal to maintain prudent fiscal policies and continue leveraging EU funds to promote productivity and the green transition.

They also advised comprehensive tax reforms to generate fiscal space for higher public investment and called for vigilance over risks in the financial sector, particularly the real estate market.