Overview
- Portugal is on track for a second straight budget surplus after posting a 1.2% of GDP surplus in 2024, according to government figures reported by French media.
- The draft outlook forecasts surpluses of 0.3% of GDP in 2025 and 0.1% in 2026, with public debt projected to decline from 93.6% of GDP to 90.2% in 2025 and 87.8% in 2026.
- Prime Minister Luís Montenegro’s government plans pension increases, income‑tax cuts and new housing investment, leveraging improved public finances.
- Analysts attribute the turnaround to sustained growth, tight spending control and strong tourism, with growth reported above 2% and unemployment near 6%.
- Commentary describes consecutive surpluses as a first since 1974 while cautioning that a severe housing crunch and continued youth emigration remain unresolved.