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Roundup: IMF forecasts more optimistic growth for Portugal

Xinhua, April 15, 2015 Adjust font size:

The International Monetary Fund (IMF) expects the Portuguese economy to grow 1.6 percent this year and 1.5 percent next year, compared with 0.9 percent growth last year, according to the World Economic Outlook released on Tuesday.

The forecast is more optimistic than last year, when the IMF had predicted a more moderate growth for 2015 and 2016, of 1.2 percent and 1.3 percent respectively.

The Washington-based organization also says the unemployment rate in Portugal will be 13.1 percent this year and 12.6 percent in 2016.

The IMF provided Portugal with 26.9 billion euros when the debt-laden country signed a 78-billion-euro bailout fund in May 2011 with the European Commission, the IMF and European Central Bank when it was on the verge of bankruptcy.

Portugal exited its bailout program in May last year and recently revealed it had decided to follow Ireland and repay its 14-billion-euro IMF debt early.

The IMF authorized the early repayment, which will take place in a maximum term of 2 years and a half, and the country has already reimbursed the fund 6.6 billion euros.

The IMF has been critical of the country's progress, doubting that the country will be able to bring down its deficit target below 3 per cent of GDP this year and has pointed out that the country must implement deeper reforms.

Portugal saw its economy expand at the fastest rate in the fourth quarter of 2014, rising 0.5 percent from the third quarter.

But the country is still struggling to reduce its public debt, which stands at over 130 percent of Gross Domestic Product (GDP).

The center-right government led by Pedro Passos Coelho is aiming for 1.5 percent growth this year and 1.7 per cent in 2016.

The IMF on Tuesday left its projection for global growth in 2015 unchanged at 3.5 per cent and 3.8 per cent in 2016, and said the rebound in advanced economies was supported by the decline in oil prices. Endit