The International Monetary Fund expects the Portuguese economy to grow by 4.4% this year

The International Monetary Fund expects the Portuguese economy to grow by 4.4% this year

The Portuguese economy is expected to grow by 4.4% this year, a rise that should be even sharper next year (5.1%). These are the forecasts for Portugal by the International Monetary Fund (IMF), which is therefore reviewing the growth of the Portuguese economy for these years. In 2023, the growth outlook is slowing down and will reach 1.8%.

The forecast was announced this Tuesday, and then the institution is reviewing projected growth for 2021 upward, compared to the 3.9% indicated in April. For the fourth quarter, the foundation led by Kristalina Georgieva expects the Portuguese economy to grow by 4.8% and 2.3% in the same quarter next year.

Looking at the numbers, the International Monetary Fund is less optimistic than the government, which in the proposed state budget for next year indicates growth of 4.8% in 2021 and 5.5% in 2022.

Regarding inflation, the International Monetary Fund expects a tenth of annual growth in the near future, starting from 1.2% this year, 1.3% next year, and 1.4% in 2023. The figures also differ from those given by the government, which expects a stable 0.9% in 2021 and 2022.

The Washington-based institution expects Portugal’s current account balance to be -1.7% of GDP this year, -2.1% of GDP in 2022 and reach -1.1% in 2026.

And in the world? Globally, the scenario has changed and the International Monetary Fund revised downward global economic growth in 2021 by a tenth, changing it to 5.9% instead of the 6% forecast in July. However, for the coming year, the expectations remain.

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“Global recovery continues, but the momentum is weak and the epidemic is paralyzed. With the support of the delta variable, the number of deaths recorded by covid-19 has grown by about five million, and health risks abound, while maintaining a full return to normal life,” reads the text of the World Economic Outlook.

As the IMF warns: “Overall, risks to the economic outlook have increased,” leading to the downward revision. “The downward adjustment also reflects some of the more difficult near-term prospects for the group of advanced economies, in part due to supply disruptions,” he adds.

In general, if Portugal grows as the IMF predicts, it will be the fifth country in the eurozone that will grow the most. Only Spain (6.4%), Malta (6%), Latvia (5.2%) and the Czech Republic (5.2%) would be in the lead.

For the more advanced economies, the International Monetary Fund indicates growth, this year, of 6% in the United States, 5% in the euro area, 2.4% in Japan, 6.8% in the United Kingdom, and 5.7% in Canada.

He warned that “the serious difference in economic prospects between countries remains a source of great concern,” adding that the projected growth of the group of advanced economies “should resume its pre-pandemic trend in 2022 and exceed it by 0.9 percentage points in 2024.”

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About the Author: Camelia Kirk

"Friendly zombie guru. Avid pop culture scholar. Freelance travel geek. Wannabe troublemaker. Coffee specialist."

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