As in most OECD countries, the pandemic triggered a deep recession in Portugal and put huge pressure on the healthcare system. The policy response helped to weather the shock and the recovery has gained speed, sustained by progress in vaccination. However, the crisis is likely to leave scars, with increased poverty and inequality. Ensuring an inclusive recovery will require strengthening health and labour market policies. Policy action also needs to tackle new financial and fiscal risks. A swift and effective implementation of the Recovery and Resilience Plan will help to address these challenges and ensure a durable recovery. A higher uptake of digital technologies - through better infrastructure and skills development - can boost long-term growth. Equipping the population with digital and foundational skills while promoting investment and innovation in small firms will be crucial to reap the benefits of the digital transformation, while leaving no one behind.

SPECIAL FEATURE: GETTING THE MOST OF THE DIGITAL TRANSFORMATION