Portugal at risk of breaking EU budget rules

Published Tue, Apr 19, 2016 · 11:15 AM

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[BRUSSELS] Portugal is at risk of breaking European Union budget rules, European Commission Vice President Valdis Dombrovskis told a news briefing on Tuesday, adding that an updated assessment would be issued by the EU executive in May.

Mr Dombrovskis said that based on the Commission's forecasts from February for Portugal's economic performance and an assessment measures the government proposed then, the country could be in breach of the rules - the Stability and Growth Pact.

"On the fiscal situation ... the Commission considers that the government plans are at risk of non-compliance with the provisions of the Stability and Growth Pact," Mr Dombrovskis said.

Portugal is aiming to reduce its budget deficit to 2.2 per cent of GDP this year from 4.4 per cent in 2015 and believes it is on track to do that.

The International Monetary Fund believes Lisbon will have to implement more measures to achieve that goal.

The Commission will make its assessment in May on the basis of final 2015 fiscal data for Portugal that will be published by the EU statistics office on Thursday and on the basis of its own forecasts as well as projections of the Portuguese government.

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