In 2020, Portugal is tied with Scandinavian countries. In the first year of the pandemic, it is one of the mildest countries in Europe, and its share of public expenditure has increased.
Dinheiro Vivo (Dinheiro Vivo) calculated according to official data released by Eurostat yesterday, in the first year of the pandemic (2020), Portugal’s public expenditure accounted for the slower growth among the 19 countries/regions in the Eurozone. One of the countries. This also helped the deficit to expand to a smaller extent.
Through this expenditure control, the government managed to keep the budget imbalance at 5.7% of GDP, which is far lower than the 7.3% that the PS government aroused when it supplemented the budget (in July).
Eurostat data (Here, open in PDF format) Shows that Portugal controls a lot of expenditures and has paid off. Portugal and Germany have the sixth slowest increase in the expenditure ratio in 2020 (compared to the previous year). Expenditure increased by 5.9% of GDP, which is significantly lower than the average of the states where a single currency is located (7.1%).
Finland is a country with a slower growth in the proportion of public expenditure. On the contrary, Greece (the public expenditure ratio has soared to 12.8% of GDP) and Spain (plus 10.2% of GDP) are at opposite extremes.
Despite the large-scale pandemic crisis that broke out a year ago, the Portuguese government finally managed to maintain the proportion of public expenditure at a level slightly higher than 48%.Increased proportion of Portuguese Increased from 42.5% in 2019 to 48.4% At the end of last year.
The euro area’s average public expenditure ratio soars From 47% to 54.1%. Therefore, Portugal is clearly still below the average of its single currency pair and even increased this distance because, as mentioned above, the spending ratio here has grown much more slowly.
Data from Eurostat shows that Portugal is one of the most spared countries. Compared with some of the richest countries in Northern Europe (such as Finland, Sweden, and Denmark), the latter’s public expenditure burden has increased moderately.
The proportion of budget revenue increased by only two-tenths (42.8% of GDP), slightly higher than the euro average (plus 0.4% of GDP).
The government stated that due to economic reasons, its response to the pandemic was better than expected, especially in the summer, but budget execution showed that it continued to be cautious in maintaining discipline and restricting spending, especially in areas other than those. health.
Take public investment as an example. In June last year, during the first wave of covid-19 and the hangover during the first major confinement period, the executive predicted that by 2020, public investment will increase by nearly 25% (in national accounts).
At the end of last month, the National Bureau of Statistics stated that, after all, the growth rate of public investment was less than half the expected rate: the promised growth did not reach 11%.
Where the deficit fell
João Leão stated in July that due to the PSD’s ability to approve changes in parliament, the deficit in 2020 is estimated to worsen by 0.7 percentage points, “from 6.3% of GDP to 7%”, which will cost 1.4 billion US dollars according to the minister. Said that the euro explained this problem well at the time.
This target will be revised to 7.3% in the 2021 National Budget (OE) (submitted in October). However, already at the beginning of this year, the minister will readjust the accounts and acknowledge that the deficit will be reduced to “close to 6.3%”, the same as in July.