Government economic forecasts for 2023 better than expected

Portugal’s president said on Friday that the government’s economic forecasts for 2023 are better than he expected but considered that they are not “an exercise in political make-up”, while also conceding that they may fail.

“The government can be wrong but does not purposely change the data because that would hit it in three or four months,” said Marcelo Rebelo de Sousa, questioned by journalists at the end of a bilateral meeting with the President of the Republic of Malta, George Vella, in Valletta.

According to newspaper Público, the government for next year projects growth of 1.3 percent, a deficit of 0.9 percent and inflation of 4 percent, as well as a reduction in debt to 110.8 percent of gross domestic product (GDP).

“It is clear to me that the government and the Bank of Portugal, in making these forecasts, are trying to play it safe, it is not a political make-up exercise, if it were it would be suicidal,” he said.

The head of state considered the economic forecasts for this year to be realistic but acknowledged that for 2023 the figure predicted for inflation may be questionable.

“If it is possible, it is not El Dorado, but it is better than many thought, than I thought myself. If it is not possible, it is because the international situation has remained very serious or has become even worse,” he said.

Asked about the warnings left today in parliament by some parties that the scenario projected by the government seems optimistic, the President of the Republic made a point of separating the forecasts for this year and those for next year.

“The figures for this year seem realistic to me, the growth that is targeted and inflation. For next year, growth is probably realistic with a push from this year, inflation is perhaps more questionable, but it is not impossible. There are those who defend it, there are those who defend higher inflation,” he pointed out.

Marcelo Rebelo de Sousa stressed it was evidence that “there is war and there are problems”.

“The government’s figures would show a more favourable scenario than was thought, and more favourable than many other European scenarios,” he pointed out, while conceding that he himself would not have expected these forecasts.

The government’s proposed state budget for 2023 will be delivered to parliament on Monday 10, and finance minister Fernando Medina and deputy minister for parliamentary affairs Ana Catarina Mendes will today present to the parties the macroeconomic scenario that will serve as the basis for the document.