The concerns of the European Union about the Portuguese socialist government have become reality. The clash between Lisbon and Brussels becomes heated given Prime Minister Antonio Costa's decision to openly challenge the Troika by approving the budget bill for 2016 without waiting for the prior opinion of the European Commission. The text has already received the OK from the Council of Ministers and will soon arrive in Parliament for final approval.
Brussels had asked Portugal to review the draft budget law as it did not meet the objectives of fiscal consolidation and expenditure reduction, but Lisbon reacted by approving the text without waiting for the Commission's opinion on the changes.
Despite this, today afternoon, the European Union gave the go-ahead with reservations to the 2016 Stability Law project, while highlighting Lisbon's continuing risk of "non-compliance" with the requirements of the Stability Pact and growth in terms of fiscal consolidation.
The news was announced by the European Commissioner for Economic and Monetary Affairs, Pierre Moscovici, according to whom there are no reasons "to ask for a revised document" in Lisbon, as the deviation from the deficit targets is "acceptable" but this, he added, “it's just a stage. There is still a long way to go and we still have a lot of work to do, the risk of non-compliance always exists”.
We remember that the Executive led by Costa has revised downwards its estimates on the 2016 deficit from 2,6% to 2,4% and those on GDP to +1,9% from the previous +2,1%, value judged too optimistic by Brussels .
