European Council has decided: Portugal is leaving the Excessive Deficit Procedure

  • ECO News
  • 16 June 2017

"Exiting the Excessive Deficit Procedure is a very important milestone for Portugal", stated the Portuguese Finance minister Mário Centeno.

The European Council has decided to revoke the Excessive Deficit Procedure (EDP) being enforced in Portugal since 2009, after the European Commission made that recommendation. Portugal now goes from this corrective arm to the preventive arm of the Stability and Growth Pact (SGP).

This decision is justified by the fact that Portugal reduced the deficit to 2% GDP in 2016, below the 3% goal inscribed in the SGP. At the same time, the Government’s forecasts are that this is a sustainable decrease which should remain unchanged for 2017 and 2018.

"This decision is a turning point. It shows the European Union considers that Portugal’s excessive budgetary deficit correction is sustainable and durable.”

Mário Centeno

Finance minister

“Exiting the Excessive Deficit Procedure is a very important milestone for Portugal because it shows that public finance are now sustainable because of our strategy: expenses are under control and we simultaneously support inclusive growth”, stated the Portuguese Finance minister Mário Centeno in a press release sent this Friday. “This decision is a turning point. It shows the European Union considers that Portugal’s excessive budgetary deficit correction is sustainable and durable”, adds the minister.

Deficits below 3% of GDP, procedures closed.

European Council

The European Commission’s vice-president Valdis Dombrovskis has also commented on the exit: “I am pleased to see that the Finance ministers approved our recommendation for Portugal’s exit of the Excessive Deficit Procedure. Today we celebrate. Tomorrow we continue the hard work. It is the right time for Portugal to continue making an effort in changing its economy. Reforms are Portugal’s way of maintaining this positive moment”, Dombrovskis stated. The Portuguese Finance minister answered the recommendation: “We will maintain a rigorous and cautious financial strategy to preserve and increase these benefits”.

Besides Portugal, the European Council decided to remove Croatia from the EDP, since their 2016 deficit was below 3% of GDP. The Council summed up: “Deficits below 3% of GDP, procedures closed”.