Fitch considers that Portugal, along with Greece and Cyprus, is a “lesson” for countries like Austria, Belgium, Finland and the United Kingdom, which are facing “high debt levels and persistent deficits.”

However, the rating agency has warned of a dichotomy in political consensus, which may reverse the trajectory followed by Southern European countries.

In a note published by Fitch, the agency explained that the factors behind the consistent rating improvements for Portugal, Greece and Cyprus, since 2010, offer “a clear signal to sovereigns in other parts of Europe where fiscal consolidation has been slow or has yet to materialise.”

In the same note, Fitch states that “for countries with high debt and persistent deficits—including Austria, Belgium, France, Finland, and the United Kingdom—the key lesson is not simply that primary surpluses matter, but that they must be sustained over several years, bolstered by growth, and maintained across political cycles to yield lasting rating gains.”