If the financial aid given to CGD and Novo Banco was not considered, the government would have registered a 0.1% surplus in 2018, in contrast with the previous year, when it presented a 0.9% deficit.
The budgetary deficit calculated through Brussels’ requirements shows that the Portuguese deficit got to 0.4% of GDP in 2018, as the parliamentarian technicians from the Budget support unit (UTAO) have announced this Wednesday. The information was released in the Parliament, by UTAO, and ECO had access to it
The document shows that the government has reached in 2018 its target for 2019. The National Statistics Institute will release official data next week, and if these numbers are confirmed, then Centeno will have surpassed his own best estimates.
When Centeno delivered the State Budget for 2018, he expected the budgetary deficit to stand at 1.1% of GDP. Half a year in, he cut his estimates down to 0.7% of GDP, and in February 2019, he noted that the deficit last year could have been actually close to 0.6% of GDP.
“UTAO estimates that the budgetary balance of public accounts in 2018, in the national accounts context, went up to -0.4% of GDP. If the estimate is confirmed, that means the government surpassed both its 1.1% deficit target expectations for 2018 stipulated in the state budget for 2018, as well as the revised estimates published later on, of a 0.7% deficit”, UTAO’s report showed.
If these calculations are correct, 2018’s deficit got down more than half then the estimated by the government in October 2017. Despite that, the impact in 2019’s deficit will be slightly lower, as this has already been planned out from an expected deficit of 0.7% for 2018. However, this news represents a great starting point for the government’s budgetary efforts in 2019.
The final value will be known on the 26th of March, as in that date INE is expected to send all the data on the excessive deficit reports to the Eurostat.
For 2019, the government was expecting a 0.2% deficit target, but the Public Finances Council noted that it could reach 0.3%, not including the injection of capital in Novo Banco, nor the impact the new regulations for professors’ careers will have on the state budget.