Lisbon, Jan. 6, 2026 (Lusa) - The Portuguese economy has been resilient, but several factors could weigh on growth in the coming years, the Organisation for Economic Cooperation and Development (OECD) warns in its Economic Survey released on Tuesday.

"Portugal's economic performance has been strong, with resilient economic growth, historically high employment rates and a rapid decline in public debt. However, Russia's large-scale invasion of Ukraine and increased trade tensions have slowed growth in Europe and affected the Portuguese economy," the document said.

Some factors could penalise growth and increase the need for structural reforms, in the OECD's view, including "labour shortages, an ageing population, the need to maintain productivity gains, rapid house price appreciation and the growing impact of climate change".

To sustain growth and continue to reduce public debt, a position of "fiscal prudence" should be adopted, as well as moving forward with structural reforms, the organisation recommends, namely in the sense of prioritising public investments that increase productivity and contain long-term spending pressures, through a "balanced mix of measures to increase revenues and limit the growth of age-related expenditure".

The labour market has also shown resilience after the pandemic, but some signs of pressure are emerging, particularly around labour shortages and the ageing population.

As for the tax system, the OECD considers it to be "excessively complex, increasing administrative costs and reducing revenues", and therefore recommends that Portugal should "simplify and broaden its tax system, based on the work of its new tax assessment unit (U-TAX), to assess and gradually eliminate inefficient tax expenditures in VAT, personal and corporate income tax regimes, which could contribute to reducing tax rates".

MES/ADB // ADB.

Lusa