Portugal – Turning the corner? Is this good news for overseas property investment in Portugal?

This recent report from the Portugal News Online, re-inforces MRI Overseas Property’s continued faith in Portugal as a sound investment and especially the prospects for their Silver Coast Beach Resort.

“In the week that quarterly GDP growth statistics showed Portugal had recorded the third highest growth figures, coupled with being found to be the most competitive economy in southern Europe and second best improvement in the construction industry, the Finance Minister has predicted that the economy is likely to recover sooner than expected and actually grow in the second half of the year.

Teixeira dos Santos has resisted the temptation to assume an euphoric stance despite latest figures both here and abroad allowing for an optimistic outlook on the immediate future. The Finance Minister said this week that the country might have already experienced the worst the current crisis can throw at it and predicted the economy might come out of the recession as early as the second half of the year.

Speaking to Reuters, Teixeira dos Santos expressed confidence that the burgeoning budget deficit would peak in 2009 before declining next year. “With the high level of uncertainty in mind, I think the Portuguese economy is now passing through the worst period and I think that as of the second half we will start seeing positive signs … basically, I expect quarter-to-quarter growth in the second half of this year,” he was quoted as telling the news agency.

The minister further pledged that taxes would not be raised once the economy had recovered, explaining that the government had not resorted to tax cuts as the effects of the crisis hit the economy here.

The minister’s comments come shortly after the government revised its GDP forecast, saying it would shrink 3.4 percent this year, 2.6 percent more than foreseen in its previous projection.

Teixeira dos Santos also told a Lisbon news conference that the government’s new estimate for unemployment in 2009 was set at 8.8 percent, up from the earlier forecast of 8.5 percent.

He said the government expected to close the year with inflation at 0.1 percent, down from the previous projection of 1.1 percent, while exports and public/private investments were expected to shrink by 11.8 percent and 14.1 percent, respectively.

The economy also received a boost on Wednesday, when the European Commission announced it had approved the government’s €4 billion to plan to recapitalise national banks.

EU Competition Commissioner Neelie Kroes, in announcing the body’s approval of the re-financing plan said Portugal’s recapitalisation plan “envisages effective measures to boost confidence in the markets” and also “establishes safeguards to limit distortions of competition.”

Further good news came when the Institute for Management Development (IMD) unveiled Portugal has being the most competitive economy in southern Europe, surpassing Spain it climbed three positions in the rankings. Boosting Portugal’s rise in the table was its continuous improvements to its infrastructures along with its competiveness in terms of costs.”

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