In their meeting, the Portuguese Minister of Finance delivered a detailed briefing on the outcome of the Troika's fifth review mission.
Both Ministers referred to the Eurogroup’s Statement on Portugal, as released on 14 September, welcoming the conclusion of the Troika's fifth review mission that the adjustment programme for Portugal remains broadly on track. Germany complimented the Portuguese authorities and citizens for the outcome of the Troika's fifth review mission and in particular for the convincing commitment to the programme.
The Portuguese economic adjustment is proving to be a demanding and painful process, calling for heavy sacrifices from the people, but the results are encouraging. The adjustment is taking place faster than expected through a rebalancing of the Portuguese economy, whose reliance on domestic demand is increasingly being complemented by exports. Competitiveness is improving, government expenditures are now under control and the structural budget deficit has declined significantly. These developments are essential to ensuring sustainable and sound public finances.
The fact that the Portuguese authorities expect to be able to cover any additional financing needs arising from the revised consolidation path without additional assistance, is further testimony to the country’s enhanced credibility. Portugal continues to prepare its return to capital markets in 2013, as foreseen in the programme. In reaffirming its confidence in Portugal, Germany strongly encourages the Portuguese authorities to continue addressing challenges and implementing policy conditionality and joins the other euro area Member States in reaffirming its commitment to assist Portugal.
The German and Portuguese Ministers also discussed the broader situation in the euro area and welcomed the recent progress achieved in tackling the sovereign debt crisis in the region. Both reaffirmed the importance of strengthening euro area governance through rules and institutions, such as the Fiscal Compact and the creation of the ESM.
Press release
© Bundesfinanzministerium
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