07-15-2016, 10:45 PM
Barclays expects Portuguese growth to slide post-Brexit, from an expected 0.7 percent in 2016 to just 0.3 percent in 2017. According to the European Commission, Portuguese GDP (gross domestic product) grew by 1.5 percent in 2015. Barclays predicts the total capital needs for Portuguese banks to be at 7.5 billion euros ($8.3 billion), including roughly 5 billion euros for state-owned Caixa Geral, the country's second largest bank. Other financial data are equally downbeat, as, for example, Barclays forecasts Portugal's deficit to fall only by a small margin, to 4.1 percent of GDP from 4.4 percent in 2015. The country's public debt tells a similar story, as Barclays predicts it to increase from 130 percent of GDP in 2015 to roughly 132 percent in 2016, remaining above 130 percent throughout the next decade. Barclays also predicts that Portugal will require 8.9 billion euros of funding for the rest of 2016, with annual borrowing averaging at 23.4 billion euros for 2017 to 2020. But, according to the Barclays note, published by a team of analysts led by Antonio Garcia Pascual, the government's inability so far to implement a realistic medium-term fiscal plan compatible with solvency is most pressing.
Portugal winning at soccer, but its economy may be fighting a losing game
The International Monetary Fund slightly lowered its 2016 and 2017 growth forecasts for Italy, saying the U.K.’s decision to leave the European Union will increase uncertainty and will likely weigh on the country’s economic performance.
IMF Lowers Forecasts for Italy’s Economic Growth - WSJ
France’s rigid labor market rules are still hampering growth and should be the focus of government efforts to modernize the economy, the International Monetary Fund said. “A key obstacle to growth remains the labor market,” the Washington-based fund said in its Article IV report on France. “Structural unemployment is projected to remain high in the absence of additional reforms. In an environment with modest medium-term growth prospects at home and in the euro area, France thus faces two central policy challenges: to support a more rapid creation of new private sector jobs and to ensure the sustainability of public finances.”
France’s Labor Market Remains Key Obstacle to Growth, IMF Says - Bloomberg