IMF trims Portugal's 2018 economic growth

2018-09-14 02:50:56 GMT2018-09-14 10:50:56(Beijing Time) Xinhua English

The International Monetary Fund (IMF) on Thursday revised down its estimate for Portugal's gross domestic product GDP growth in 2018 to 2.3 percent, which is in line with the government's forecast.

The IMF said in a report that Portugal's economic growth is expected to moderate this year after robust growth in 2017 driven by investment and exports.

The IMF has lowered its 2018 forecast from the 2.4 percent it projected in April, and it is now in line with the figures in Portuguese government's Stability Program 2018-2022.

For next year, however, the IMF is less optimistic than the government, projecting the country's GDP growth of just 1.8 percent if significant economic reforms are not adopted.

"Investment and exports should remain important drivers of growth, albeit at a slower pace, while private consumption eases somewhat," the report said.

"Employment growth is expected to decelerate, and the labor market should continue tightening in 2018, with average unemployment declining below 7.5 percent, supporting moderate real wage growth.

The IMF estimated that in 2018, Portugal's external balance will deteriorate due to the growth of imports and that the budget deficit will shrink further, helping to reduce public indebtedness as a percentage of GDP, although the trajectory of public debt "remains subject to significant risks".

Portugal's deficit is set to be 0.7 percent of its GDP in 2018 and debt 121 percent at the end of the year, down from 126 percent in 2017, the IMF said.