the inability to look at oneself – Observer
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In 2005, Medina Carreira stated on RTP1 – in a debate with Basílio Horta – that “if we continued on the same path” Portugal would be “the poorest country in Europe” in 2020.
Fifteen years later, Medina Carreira is no longer with us, but he didn’t miss much: in 2022, according to data from the Eurostat, Portugal has one of the lowest GDPs per capita in the EU, just ahead of Greece and a group of five Eastern European countries (Romania, Latvia, Croatia, Slovakia and Bulgaria). However, if in the coming years as an indicator trajectories in these coming years it is predictable that – soon the country will be Romania to be Portugal a-us.
However, Medina Carreira does not need any visionary skills to make the prediction. It used officials, prospectively evaluated public policies in force and made their diagnosis and prediction. company, the bankruptcy of 2011 confirmed the wrong Portuguese path and also brought us – once again – the diagnosis of the “Portuguese economic disease”. Today, that well-known diagnosis is confirmed – which, not essential, has not changed much in the last few years, but without adequate therapy there will never be a cure for this “the many years there will never be” in the future, just as there will be no cure in the past.
Just to give one more example – now from the present – Nuno Palma has today the same difficulty in getting his message across, as happened in 2005 with Medina Carreira. This renowned professor at the University of Manchester was very critical last year for having affirmed the conference that Portugal had in the 60s of the 20th century – and, therefore, in a plenary session, the highest rate of economic growth of the last 70 years. As initially a demonstration has been presented to the background of the disability that the country itself is, which prevents an adequate approach as a diagnosis and the subsequent implementation of the appropriate therapy for the cure.
The factual nature of Nuno Palma’s declaration is, in December, unequivocal, as, moreover, a joint publication by INE and Banco de Portugal confirmed in 2021 (Long Series for the Portuguese Economy 2020). In this of the national statistics that have been provided in the databases since the 20th century – there is a lot of certainty and rigor, whether from the publication of the report by Nu Palma that refers to Medina Carreira.
The graphs below, published in the publication, clearly demonstrate both the growth in the 60s of the 20th century and the stagnation of the last 20 years. And from the graphic side as trends are no longer named health, nowadays, the population has not grown for years and the population age, which under enormous our social protection systems (reforms and pensions and social security).
Also in the same publication by INE and Banco de Portugal, it is possible to analyze in more detail in two Portuguese graphs, as well as other growth rates at each historical moment. This demonstrates, not only that the average rate of economic growth in the 60s of the 20th century – 4.7% – in the last 70 years in Portugal, but also that the average growth rate in the first 20 years of the 21st century – in addition to being very low (0.9%) – it is less than a third of those verified in the last 20 years of the 20th century (above 3%). The country has therefore been economically stagnant for 20 years.
But what is this stagnation due to? Although, according to references, the diagnosis has been largely made, the national authorities help us – in the same publication – to understand the phenomenon. Just look at the graph on the left panel below to see the existence of serious problems in terms of productivity and capital stock; so much so that there are historical moments in which the contribution of these two factors to GDP growth is even negative.
And how to solve this problem of economic stagnation and put the country back on the path of prosperity?
First, you have to accept the diagnosis and then treat the cure. As long as they remain in denial and happily resign themselves to the anemic growth of the last 20 years, there will be no reformist governments in Portugal. And without profound reforms that increase factor productivity, there will be no higher rates of economic growth, and, because they do not grow, the “pie” to be distributed will increase. And distributing wealth without on the way – the ones followed in the last 20 years – correspond to distributing (public) debt, which has already led us to bankruptcy (2011), of which the Portuguese have a (bad) memory and will certainly not create an economic economy that repeat.
In fact, the country of structural reforms and that promote economic growth that directs the country to a country that needs the rich state that the Portuguese owe and that has been absent for millennia.
It’s time to stop denying as proven. We currently have a generation of “millennials” who live today in a poorer country than the one in which they were born. If we don’t want to regret it again, 20 years from now of the country’s slow decline, we have to act now. We owe it to our children.
The author of this text writes according to an ancient orthography.