Portugal has the sixth highest public debt to GDP ratio in the European Union, according to data by Eurostat. It recorded the second largest year-on-year drop in debt among Member States, in the third quarter, which has allowed the country to leave the top 5 most indebted in Europe according to a report by ECO.

Despite this reduction, Portugal's public debt — which stood at 107.5% of GDP in the third quarter of 2023 — remains above the community and Eurozone average, as well as the target established in the budgetary rules of 60% of GDP.

Debt stood at 89.9% of GDP in the Euro Zone and 82.6% in the EU, both values representing a reduction both year-on-year and compared to the previous quarter. At the end of the third quarter of 2023, loans represented 13.6% of Eurozone debt and 14.1% of the EU.

Portugal is among the countries that achieved the largest debt reductions in the third quarter. If the comparison is made with the same period last year, the biggest reduction was achieved by Greece (12 percentage points) followed by Portugal (10.9 pp) and Cyprus (10.3 pp). Compared to the previous quarter, that is, as a whole, Cyprus (5.6 pp) and Luxembourg (2.6 pp) are ahead of Portugal (2.5 pp).

The final value for 2023 is not yet known, but public debt is expected to fall to be very close to the threshold of 100% of GDP, according to estimates by the resigning Finance Minister, Fernando Medina.