Public debt decreases to 127.0% of GDP in Q1

  • ECO News
  • 2 May 2022

Pandemic threw Portugal's public debt to 138.9% of GDP a year ago. Since then it has fallen successively, quarter after quarter, closing at 127% at the end of March.

After peaking in the first quarter of last year at 138.9% of GDP, due to the impact of the pandemic, public debt has been falling for four consecutive quarters, closing at 127% of GDP at the end of March. This corresponded to an absolute amount of €276 billion, the second highest ever, according to data released this Monday by the Bank of Portugal (BoP).

Monthly data shows a 0.4 percentage points reduction from the end of last year, with this downward trend being supported by the economy’s progress at the start of 2022.

The Portuguese economy grew by 2.6 percent year-on-year between January and March, on the back of a recovery in tourism and consumption, which more than offset the increase in public debt in absolute terms by around 7 billion during this period – from 269 billion in December to €276 billion in March.

The country’s public debt in absolute terms increased by €1.2 billion in March 2022, due to “debt securities issuances (€0.9 billion) and a new tranche of the loans disbursed by the European Commission (€0.5 billion) under the European SURE instrument,” explains the Bank of Portugal.

General government deposits increased by 1.5 billion. Net of those deposits, public debt decreased by €0.4 billion, to €253.8 billion.