Upgrade of Portugal’s score to EEE- from EE+ and changed outlook to stable from positive

Paris, August 29, 2017 – Beyond Ratings has upgraded Portugal’s long-term score to EEE- from EE+ and changed outlook to stable from positive.

This upgrade reflects Beyond Ratings expectation expressed one year ago that Portugal’s recent growth trend – and above all – fiscal improvements have been important drivers of this decision. Indeed, with the lowest budget deficit since 1974 reached in 2016 (at 2.1% of GDP), we expect the country to continue to deliver tighter fiscal policy while maintaining political stability, and that narrowing deficit. Moreover, the latest growth figures (+1.6% in 2015 and +1.4% in 2016) should support sustained reduction of Portugal’s debt-to-GDP ratio in the long run.

As a reminder, Portugal endured years of painful austerity under an EU/IMF bailout programme in 2011-14 following a severe debt crisis, but the left-leaning Socialist Government, in place since late 2015, has managed to combine budgetary discipline with a reversal of some of the austerity measures.