Por­tu­gal has no fund­ing prob­lems de­spite the eu­ro­zone debt cri­sis: PM

The Pak Banker - - International3 -

PARIS: Por­tuguese Prime Min­is­ter Jose Socrates said his coun­try can still raise funds from the mar­kets de­spite the eu­ro­zone debt cri­sis be­cause in­vestors un­der­stand the re­forms the govern­ment has in­tro­duced. "We are do­ing what we need to do-con­sol­i­dat­ing the bud­get deficit very quickly and very ef­fec­tively on the ba­sis of struc­tural re­forms," Socrates told the Fi­nan­cial Times in an in­ter­view Tues­day. "Mar­kets will un­der­stand this more and more," he said. Por­tu­gal has come un­der in­creas­ing pres­sure in re­cent months af­ter debt and deficit prob­lems in first Greece and then Ire­land led to EU-IMF bailouts when they could no longer raise fresh cash from the mar­kets at sus­tain­able rates.

The cri­sis drove spec­u­la­tion that Lis­bon and pos­si­bly Madrid could be next in line al­though ten­sions have eased slightly since Ire­land's res­cue this month. While Por­tu­gal has to cover 20 bil­lion eu­ros (26 bil­lion dol­lars) in due debt by mid-2011, Socrates said Lis­bon would have no prob­lems in fund­ing. "Por­tu­gal has the nec­es­sary con­di­tions to go on rais­ing debt in the mar­ket," he told the FT. "We have had no bank­ing cri­sis or prop­erty bub­ble. Our only prob­lem was an ex­ces­sive bud­get deficit due to the global cri­sis and we are cor­rect­ing that. Socrates said govern­ment re­forms, es­pe­cially on pen­sions and so­cial se­cu­rity re­form, meant Por­tu­gal was do­ing bet­ter than other coun­tries in sta­b­lis­ing its pub­lic fi­nances. -Ap

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