LISBON, June 24 (Xinhua) -- The International Monetary Fund (IMF) on Wednesday revised down its growth forecast for Portugal to 1.7 percent in 2026, citing the economic fallout from the conflict in the Middle East.
The new projection is 0.2 percentage points lower than the IMF's estimate in its April World Economic Outlook and falls below the Portuguese government's forecast of 2 percent growth submitted to the European Commission in April.
According to the IMF, the adverse effects of the Middle East conflict are expected to offset gains from increased disbursements of European Union funds.
The IMF also noted that severe storms at the beginning of the year weighed on economic activity in the first quarter. However, reconstruction and repair work is expected to support growth later in the year, leaving the overall annual impact broadly neutral.
Looking ahead, the IMF forecasts Portugal's economy to expand by 1.6 percent in 2027. The slowdown is expected to reflect the gradual winding down of investment financed under the country's Recovery and Resilience Plan. ■