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11 July 2012

WSJ: Portugal's leader won't soften austerity


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Portuguese Prime Minister, Pedro Passos Coelho, vowed to push ahead with the government's plan to revamp the small country's economy, despite calls from opposition lawmakers to renegotiate terms of its €78 billion bailout.


"The big objectives that the government committed to will not be softened", Mr Passos Coelho told parliament in a state-of-the-country address.  However, he acknowledged the country's fiscal adjustment is "challenging" due to an increase in unemployment that has forced the government to spend more on social benefits and receive less from tax revenue.

Official budget deficit figures released last month showed that the first quarter budget deficit increased to 7.9 per cent of gross domestic product, from 7.5 per cent for the year earlier period.  The budget deficit target for this year is 4.5 per cent.

"We will act with determination to fulfil the set budget goals", Mr Passos Coelho said. His comments were directed at main opposition leader, António José Seguro of the Socialist Party, who said Mr Passos Coelho's austerity measures are killing the country's economy.

Full article



© Wall Street Journal


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