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Image header Agence Europe
Europe Daily Bulletin No. 8403
Contents Publication in full By article 13 / 23
GENERAL NEWS / (eu) eu/stability pact

Commission prepares to caution Portugal on overspending in 2003

Brussels, 18/02/2003 (Agence Europe) - The European Commission is preparing to draw Portugal's attention to a risk of overspending on its public finances in 2003, because of growth lower than government predictions. The Commission will make a statement on Wednesday on the stability programme presented by Lisbon for the 2003 - 2006 period, and its recommendations will be examined by the Ecofin Council of 7 March. Rebuked by its partners for its excessive deficits in 2001, Portugal committed to reduce them to 2.8% in 2002, 2.4% in 2003 and 1.9% in 2004 in order to achieve quasi-equilibrium in 2006 (0.5%). The Commission should be reassured by initial figures showing that the deficit did reach 2.8% in 2002. However, it should be concerned by the excessive optimism in the growth predictions (1.25%) submitted by Lisbon for 2003, and should consider new budgetary restriction measures necessary if Portugal's deficit for this year is to remain below the 3% set by the stability pact.

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