Portuguese prime minister says no bail-out needed
José Sócrates says opposition parties who rejected his austerity plan must come up with their own ideas for economic recovery.
● Photos from the European Council
José Sócrates, Portugal’s prime minister, today said that his country does not need an international bail-out.
Sócrates, who resigned as prime minister on Wednesday (23 March) after opposition parties failed to back an austerity package, warned that the eurozone’s stability was at risk if Portugal asked for a bail-out from the EU and the International Monetary Fund.
“If Portugal were to fail, that would then expose other countries to risk. There would be a domino effect,” said Sócrates.
He said he told EU leaders that they had to show faith and “confidence” in his government’s proposed austerity plan, adding that rumours of a bail-out “did not help”.
Sócrates said he did his “absolute best” to get the Portuguese parliament to back his austerity plan, which gained the support of the European Commission and other eurozone countries when they met in Brussels on 11 March.
The Portuguese prime minister lashed out at opposition parties in his country for failing to back the plan. “They have to look at what they have done,” said Sócrates. “If the parties want to improve Portuguese credibility then they have to put forward their alternatives so that markets are reassured”.
All five of Portugal’s opposition parties rejected the austerity package presented by Sócrates’s centre-left minority government on Wednesday. An election is not expected until April or May.
The political crisis has raised fears on the markets that the country will now be unable to avoid a bail-out.
Angela Merkel, Germany’s chancellor, said Portugal’s opposition parties “have to make clear” that they share the goal of introducing tougher austerity measures to reduce the country’s budget deficit and debt. She said she was “neither optimistic nor pessimistic” as to whether the country would eventually have to seek a bail-out.
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