Portugal 2016

ACTIVIDADE ECONÓMICA ADMINISTRAÇÕES PÚBLICAS ECONOMIC ACTIVITY GENERAL GOVERNMENT 109 The -3.2 p.p. reduction in the total expenditure ratio was mainly due to a decline in capital expenditure, whose annual rate of change was approximately -54.0%, leading to a negative contribution of around -4.8 p.p. to the rate of change in total expenditure and a contribution of -2.3 p.p. to the reduction in the above ratio. In addition, the moderate growth of 1.0% in current expenditure implied a contribution of approximately -0.8 p.p. to the reduction in said ratio. The total expenditure ratio stood at 45.0% in 2016. Considering current expenditure in greater detail, growth amounted to 2.6% in personnel expenses and 2.1% in other current expenditure (group of expenses including intermediate consumption), whose ratios to GDP declined somewhat. The more moderate growth of social benefits other than social transfers in kind (around 1.2%) implied a more significant reduction in this item’s ratio, of around 0.3 p.p. However, the strongest contribution to the reduction in the weight of total expenditure in GDP was made by the interest item, which declined by 5.5% from the previous year, corresponding to a contribution of around -0.5 p.p. to the decline in total expenditure and almost -0.4 to its ratio to GDP. Consequently, the current expenditure ratio declined by 0.8 p.p., accounting for 43.1% of GDP. Public debt increased to 130.1% in 2016, countering the -1.8 p.p. decline observed in 2015 and moving closer to the peak recorded in 2014.