Leão, Costa created a ‘very strong’ recovery plan – Donohoe
"I am really confident in the capacity of the Portuguese economy to recover," Paschal Donohoe said after a meeting of the European Stability Mechanism (ESM) Board of Governors.
The president of the Eurogroup said on Thursday he believes that Portugal’s finance minister and prime minister have put together a “very, very strong” Recovery and Resilience Plan (RRP) that will make a strong contribution to the recovery of the Portuguese economy.
“I am really confident in the capacity of the Portuguese economy to recover,” Paschal Donohoe told a press conference after a meeting of the European Stability Mechanism (ESM) Board of Governors in Luxembourg when asked whether Portugal might not face challenging times when monetary policy becomes less expansionary and fiscal discipline rules are triggered again because of the high level of public debt.
The Irish minister, who succeeded Mário Centeno as chairman of the informal forum of euro-area finance ministers, considered that “the consequence of this recovery”, in which he has great confidence, “will be a natural improvement in the public finances” of the country, and then pointed out the importance that will have the support of the recovery fund, from which the country will benefit through its RRP, the European Commission approved on Wednesday.
“Minister [João] Leão and Prime Minister [António] Costa have put together, I believe, a very, very strong recovery plan, which comes precisely at the time when the Portuguese economy and the Irish economy will need us over the next year,” Donohoe said, drawing a parallel between the two countries.
According to the Irish minister, the Portuguese and Irish economies “have in common the need, which they all have, for additional support and additional investment” at a time when the page is turned on “the most critical period of the public health crisis”.
“So my colleagues and I are quite confident in the ability of the Portuguese economy to recover, and we believe, as I said, that the recovery plan will make a strong contribution in that regard, which in itself will operate the kind of change in public finances that will help address other challenges that Portugal and many other countries are currently facing,” he concluded.
Portugal’s Recovery and Resilience Plan – worth a total of €16.6 billion, of which €13.9 billion in outright grants – was approved on Wednesday by the Commission and is due to receive the green light from the Council on 13 July, which will allow the first funds to be disbursed to aid the post-Covid-19 recovery.
