The NECEP – Católica Lisbon Forecasting Lab – announces today its forecasts for portuguese economy.
According to NECEP, everything points to the activity level in the second quarter of portuguese economy, might was the biggest since the beginning of the pandemic and confinement policies introduced in March 2020.
Thus, the portuguese economy must have grown 5% quarter-on-quarter, or 15.5% year on year. Wherefore it must be running about 95.5% of the fourth quarter’s level of 2019; the last one without results from the pandemic and confinements.
The rest of the year should be influenced by the combined effect of the intensity of restriction orders, still ongoing, and tourism recovery. In 2021 the central scenario of PIB’s growth is currently of 3.5%, an upward revision of 2.5 percentage points which would put portuguese economy running to about 95.7% of 2019 level. However, there is high uncertainty for this year’s growth, that can change between 2% and 5% according to the limitations of economic activity and the extent of budget support to families and companies. For 2022, it is predicted a growth of 4.5% that presumably will be able to return to 2019 activity level. As we hit that level, the growth should slow down to around 2%, along with the predictable return of fiscal consolidation measures in 2023, to reduce the public debt to medium- and long-term sustainable levels.