João Leão estimates that this year’s deficit will be between 4.5% and 5% of the GDP national budget in 2021

Finance Minister João Leão said this Tuesday evening that the deficit in the public accounts should be between 4.5% and 5% of gross domestic product (GDP) by 2021.

In an interview with RTP3’s Tudo é Economia program, João Leão estimated that the negative balance of the public accounts this year, to be presented in the Stability Pact in April, will be between 4.5% and 5% of GDP and above the forecast value of 4.3%.

First of all, he said: “Only at the time of the stability program” would the government publish its forecasts. When asked directly whether the deficit will be between 4.5% and 5%, he finally said admitting that “yes, it can be in that interval”.

Regarding economic growth, João Leão previously said the government will revise its forecasts downwards, “mainly because of the impact of the pandemic [de covid-19] in the first quarter ”.

“On the one hand, we have the effect of vaccines that both Portugal and the Commission have [Europeia]who also predicts that in the second half of the year we will have a very strong economic recovery and a program that will focus on economic and social recovery from the crisis for both 2021 and 2022, ”he said.

The current government estimate points to economic growth of 5.4% this year, downgraded by a percentage of “more than one point”. “The downward revision this year will mean that a very strong recovery in the economy is expected in the second half of the year, that the economy will grow faster than expected from both the second half and 2022,” he said.

João Leão predicts that the recovery in 2022 could mean that the economy is already “above pre-pandemic levels” and “well above 2019 levels”.

To do this, the government is relying on the “very strong momentum” of the Recovery and Resilience Plan (PRR) currently being analyzed by the European Commission, as well as “other very important investments” in a program that focuses on economic and social recovery “.

The minister also ruled out post-pandemic tax increases, believing this was a “wrong way” to fund the measures taken.

João Leão concluded the interview by saying that “there are political conditions” to approve the state budget of 2022, “with an even larger majority than last year”.

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