Adjusting to external imbalances within the EMU, the case of Portugal

From 1995 to 2010 Portugal has accumulated a negative international asset position of 110 percent of GDP. In a developed and aging economy the number is astonishing and any argument to consider it sustainable must rely on extremely favorable forecasts on growth. Portuguese policy options are reduced in number: no autonomous monetary policy, no currency to devaluate, and limited discretion in changing fiscal deficits and government debt. To start the necessary deleveraging a remaining possible policy is a budget-neutral change of the tax structure that increases private saving and net exports. An increase in the VAT and a decrease in the employer’s social security contribution tax can achieve the desired outcome in the short run if they are complemented with wage moderation. To obtain a substantial improvement in competitiveness and a large decrease in consumption, the changes in the tax rates have to be large. While a precise quantitative assessment is difficult, the initial increase in the effective VAT rate needed to allow the social security tax to decrease by 16 percentage points (pp) is approximately 10 pp. Such a large increase in the effective VAT rate could be obtained by raising most of the reduced VAT rates to the new general VAT rate of 23 percent. The empirical analysis shows that over time the suggested tax swap could generate surpluses and improve the trade balance. A temporary version of the suggested tax-swap has the attractiveness to achieve a sharper increase in the private saving rate maintaining the short run gains in competitiveness. Finally, the temporary version of the fiscal devaluation could be the basis for an automatic stabilizer to external imbalances within a monetary union.Portugal has been running large current account deficits every year since 1995. These deficits have accumulated to an astonishing 110 percent of GDP negative external asset position. The sustainability of such a large external position is questionable and must rely on fantastic productivity growth expectations. The recent global financial crisis appears to have anticipated the international investors reality check on those future expectations with the result of a large increase in the cost of external financing. Today the rebalancing of the current account through an increase in national savings and an improvement in competitiveness must be at the top of the Portuguese authorities “to do” list as the cost of a pull out from international investors is of the order of 10% of GDP. The external rebalancing is difficult as the degrees of freedom of the Portuguese authorities are limited in number: they have no autonomous monetary policy, no currency to devaluate, and little discretion in fiscal policy as deficit limits and debt targets are set by the Stability Growth Pact and the postcrisis consensus on medium-term fiscal consolidation. One possibility that remains is to change the fiscal policy mix for a given budget deficit. The purpose of this paper is to explore the effects of a “fiscal devaluation”1 obtained through a tax swap between employers’ social security contributions and taxes on consumption2. The paper begins by illustrating Portugal’s current account evolution during the euro period. The second section section lays out a model to offer a qualitative assessment of the dynamic outcomes of the the tax swap. I show that the suggested tax swap can in theory achieve the desired outcomes in terms of competitiveness and consumption if complemented with moderation (stickiness) in wages. I also study the effects of a temporary version of the tax swap and show that it achieves a sharper improvement in the current account that accelerate the rebalancing. The third section moves to the empirical analysis and estimates the likely effects of the tax swap for the Portuguese economy. The fourth section concludes.

Prognostic modelling of breast cancer patients: a benchmark of predictive models with external validation

Dissertação apresentada para obtenção do Grau de Doutor em Engenharia Electrotécnica e de Computadores – Sistemas Digitais e Percepcionais pela Universidade Nova de Lisboa, Faculdade de Ciências e Tecnologia

EcoTerra Model - application of environmental fiscal reform in local government financing in Portugal

Critical Issues in Environmental Taxation: International and Comparative Perspectives: Volume VI, 699-715

The adoption of cloud computing by SMEs: identifying and coping with external factors.

Comunicação apresentada na CAPSI 2011 - 11ª Conferência da Associação Portuguesa de Sistemas de Informação – A Gestão de Informação na era da Cloud Computing, Lisboa, ISEG/IUL-ISCTE/, 19 a 21 de Outubro de 2011.

A utilização de actos complementares de diagnóstico: uma análise económica

Dissertação submetida para obtenção do grau de Doutor em Saúde Pública Especialidade de Economia da Saúde

Studying the impact of co-authorship with external researchers:the case of research community in Portugal using social network analysis.

Project work presented as a partial requirement to obtain a Master Degree in Information Management

(Re)Financing in a capital intensive industry during economic crises

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

Determinants of Portuguese external imbalances

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

Financing green development: 'Climate Bonds’ as a solution for institutional investors engagement

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

Essay on external imbalances within the Euro Area

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Economics from the NOVA – School of Business and Economics

External brand extensions impact on Diesel's brand image

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

Codeship: Financing growth: Case study and Teaching note

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

Corporate social responsibility: How internal and external CSR perceptions influence employee outcomes

A Work Project, presented as part of the requirements for the Award of a Masters Degree in Management from the NOVA – School of Business and Economics

Políticas de financiamento de I&D em Portugal [R&D financing policies in Portugal]

Baseado no relatório para a disciplina de “Avaliação de Ciência e Tecnologia” da responsabilidade do Prof. João Crespo (FCT-UNL) do Programa Doutoral em Avaliação de Tecnologia em 2012

O contrato de Project Finance

Currently, Angola portrays a notorious economic growth and due to recent innovative legislations, it has become the major investment attracting pole, especially in Sub-Saharan Africa, having, thus, an extraordinary potentiality for a rapid and sustainable development, likely to place her in outstanding positions in the world economic ranking. Yet, such economic growth entails demanding levels of intensive investment in infrastructure, what has been reported of the Angolan Government to be unable to respond to, save if recurring to very high index of external debt, poisoning, in this way, the future budgeting of the country. Due to these infrastructure investment shortages, the cost of production remains highly onerous and the cost of life extremely unaffordable. On this account, the current study disserts about the contract of Project Finance; an alternative finance resource given as a viable solution for the private financing of infrastructure, aiming to demonstrate that such contractual figure, likewise the experience of several emerging economies and others, is a contract bid framework to take into account in today’s world. It refers to a financing technique – through which the Government may satisfy a common need (for example, the construction of a public domain or public servicing), without having to pay neither offer any collateral – based on a complex legal-financial engineering, arranged throughout a coalition of typical and atypical agreements, whereby it is mandatory to look back at the basic concepts of corporate law. More than just a simple financial study, the dissertation at stake analyses the nature and legal framework of Project Finance, which is a legally atypical and innominate contract, concluding that there is a relevant need for regulating and devoting a special legal regime in the Angolan jurisdiction for this promising legal form in the contemporary corporate finance world.