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Home > Country Profiles > Portugal

Country Profiles

Financial Outlook

Portugal moved closer to exiting its bailout program in December 2013 after the international lenders that saved the country from bankruptcy approved a review of the economy six months ahead of schedule. The European Union and the IMF agreed a €78 billion bailout of the economy in 2011 in return for the implementation of economic reforms. Portugal hopes to leave the bailout agreement in the middle of 2014. In November 2013 the government approved a new set of austerity budget measures. Public sector workers saw their pay, holiday, and pensions cut as Lisbon sought to reduce the budget deficit to 4% of GDP in 2014 from 5.5% in 2013. The country emerged from its deepest downturn since the 1970s in the second quarter of 2013. However, the economy is still estimated to have contracted by 1.8% overall in 2013 but is expected to return to growth of 0.8% in 2014. There is concern over deflation. Consumer prices rose by an average of just 0.3% in 2013 and annual consumer price inflation registered –0.2% in November 2013.

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Further reading on Portugal

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