Oeiras, Portugal, Sept. 11, 2025 (Lusa) - Portugal's finance minister acknowledged on Thursday that the level of growth of the Portuguese economy is below the government's "ambition", but stressed that it is outperforming the eurozone in the context of global uncertainty.
"Our growth has been 2% or more, which is still below the target, the government's ambition, but it's still well above the eurozone average," he said at the close of the conference "Portugal's position in a changing global order", held at the Nova School of Business and Economics in Carcavelos, Oeiras.
At the meeting organised by the British newspaper Financial Times, at which he spoke in English, Joaquim Miranda Sarmento stressed that "the Portuguese economy has shown enormous resilience and adaptability, especially since the pandemic" and expressed confidence that it would be able to withstand external shocks.
Portugal's Gross Domestic Product (GDP) grew by 1.9% in 2024, and that year was above the 1.8% projected by the executive. However, in the first half of this year, it slowed down, growing 1.7% year-on-year, and in the second quarter, it grew 1.9% compared to the same period last year.
The performance in the first six months is below the executive's annual target, bearing in mind that the annual GDP growth projection is 2.1%, according to the figure in the State Budget for 2025.
At the conference, the minister emphasised that employment continues to grow, that exports are suffering from the international context, but that they should continue to increase.
Miranda Sarmento emphasised that "a small, open economy like Portugal's is subject to all these threats" and that the first of these "are geopolitical shocks".
"The war in Ukraine continues to generate uncertainty. We are all worried about the escalation of the conflict and the impossibility of a serious war. Secondly, we are confronted with tariffs and trade wars," he said.
"We hope that chapter is now closed and that the uncertainty is over, but tariffs are going to hurt everyone. They're going to hurt consumers and the US economy (and we're already seeing that), but they're also going to hurt exporting companies," he warned.
Despite this, the minister believes that "exports will continue to grow", without jeopardising "the goal of reaching more than 50% of GDP in the coming years".
As a sign of confidence in the economy's performance, he mentioned the fact that Portugal is attracting foreign investment. "We've managed to attract a Lufthansa Technik factory, a Calb factory - a Chinese battery manufacturer - Volkswagen's new electric vehicle and also strong investment in data centres, mainly from US companies, but also from European companies," he said.
In the same context, he mentioned the fact that Novo Banco is being bought by the French group BPCE, "the second largest French bank, the fifth largest European bank", which he says is "a sign of incredible confidence in the country on the part of investors and the markets".
Concerning public accounts, he expects debt to fall to 92% of GDP at the end of this year and to fall back to 88% in 2026, remaining "below the eurozone average".
The forecasts remain in line with those of the Stability Programme presented to parliament on April 15, 2024, which foresaw a reduction in public debt to 91.4% in 2025 and 87.2% in 2026.
The minister reaffirmed that the government hopes to achieve a budget surplus of 0.3% of GDP this year and 0.1% in 2026.
Miranda Sarmento also recalled the intention to move forward with simplifying the tax system, "to resolve litigation", and to reduce personal income tax and corporate income tax.
At the end of the conference, the minister left without wanting to speak to journalists, saying: "We'll talk soon".
PCT/ADB // ADB.
Lusa
