Brussels issued four recommendations for Portugal, urging the country to consolidate its public debt reduction.
Portugal has been a good student, but even good students get warnings from time to time. In the context of evaluating this ending semester, Brussels issued four recommendations for Portugal, urging the country to consolidate its public debt reduction.
To foment new investment in the economy and bet on increased training and professional qualifications of the Portuguese workforce are among Brussels’ recommendations. Let us take a quick overview of what has been said:
- Brussels stated that Portugal “should achieve its medium-term budgetary objective” in 2020, leaving out extraordinary national occurrences as were the 2017 fires. Despite being positively evaluated, Portugal was compelled by Brussels to ” further reduce the general government debt ratio”, at a moment when the Portuguese debt reaches a new historical level of 252Bn€. Brussels also defended that Portugal should be looking closely to its public companies’ accounts as a sign of commitment to more transparent and overreaching monitoring.
- Portugal was equally advised to adopt measures in order to “reduce labour market segmentation”. Brussels suggested that some measures should be implemented to improve skills, especially those related to digital literacy and others focusing on the requalification of more senior workers to meet the needs of the market. A more specific recommendation advised Portugal to increase the number of IT graduates and build more effective social protection mechanisms.
- “The country should focus its economic policy on research & development, railways, and port infrastructures” alongside with energetic transition. In this regard, Portugal is advised to “better energy connectivity” by “taking into account regional disparities.”
- For Brussels, Portugal should allow “an efficient repossession of collateral” associated with non-performing loans, promoting more efficient insolvency proceedings. It also emphasizes that the average duration for companies to undergo their recovery proceedings is too long, which affects “the prices applied by the market to non-performing assets”. Another suggestion is that Portugal increases the judicial system’s efficiency by shortening decision time.