PORTUGAL: Portuguese Economy Minister Alvaro Santos Pereira confirms country's commitment to bailout terms.

Record ID: 417712

  • Title: PORTUGAL: Portuguese Economy Minister Alvaro Santos Pereira confirms country's commitment to bailout terms.
  • Date: 27th June 2012
  • Summary: LISBON, PORTUGAL (JUNE 26, 2012) (REUTERS) WIDE OF INTERVIEW WITH PORTUGUESE ECONOMY MINISTER ALVARO SANTOS PEREIRA CLOSE OF HANDS (SOUNDBITE) (Portuguese) PORTUGUESE ECONOMY MINISTER, ALVARO SANTOS PEREIRA, SAYING: "As we have pointed out on numerous occasions, the issue of euro bonds is not on the table right now. What is important for us, in order for us to restructure
  • Embargoed: 12th July 2012 13:00
  • Keywords:
  • Location: Portugal
  • Country: Portugal
  • Topics: Politics
  • Reuters ID: LVACKVXYNY4PROCZXOWT24FA3UUZ
  • Story Text: Portugal is fully committed to meeting the terms of its 78-billion-euro bailout and to boost the country's ability to grow through economic reforms, Economy Minister Alvaro Santos Pereira said in an interview with Reuters on Tuesday (June 26).
    Santos Pereira said that the country's strong commitment to the bailout terms has boosted credibility in the country, just as the euro zone crisis has spread to bigger members Spain and Italy.
    Portugal's single-minded reform drive in the past few months has rewarded the country with falling bond yields. Ten-year bond yields are currently at 9.8 percent, sharply down from highs around 17 percent at the beginning of the year.
    Santos Pereira repeated the centre-right government's stance that the country will do what it takes to regain credibility, adding that Portugal cannot control what goes on elsewhere. Since the crisis started Portugal has been susceptible to bouts of contagion and it remains the second-most risky country in the euro after Greece, in terms of bond spreads.

    "We need to continue to follow the politics of structural reforms. We believe it is a policy that will reinforce the competitiveness of our economy and will allow growth in Portugal," he said.
    The country's fulfilment of the terms of its bailout from the European Union and IMF has been praised by Berlin and Brussels but Portugal has descended into its worst recession since the 1970s as the government slashes spending.
    So far Lisbon has met all budget goals under the bailout, which it sought last year.
    Pereira said Europe's growth and employment strategy is "essentially about structural reforms."
    The centre-right Portuguese government has not joined the demands of Spain and Italy for rapid action by the European Central Bank to help overcome the crisis but Santos Pereira urged unity in Europe to overcome the challenges.

    "We think it is fundamental, at this time of difficulty, that Europeans can unite in order to overcome these difficulties. That's what we are doing in Portugal, through our structural reforms, and social dialogue. It is precisely through uniting that we managed to overcome some of these difficulties," he said.
    But, for now, the minister said he did not expect the introduction of so-called euro bonds.
    "The issue of eurobonds is not on the table right now."
    Since signing up to the bailout last year, the government has adopted reforms in everything from the labour market to legal system and bankruptcy laws.
    The euro zone crisis has led Portugal into its deepest recession since the 1970s, with overall unemployment at a record 15 percent, and with one-in-three people under 25 out of work.

    "Unemployment is the main concern for this government," Santos Pereira said.

    "The labour reform is of great importance in order to make the contraction more flexible, in order to give dynamism to the job market. We have an agenda for job creation."
    Santos Pereira said another sign of belief in Portugal's reform strategy has been the strong interest in privatisation established in the bailout. Under the programme the country needs to sell assets worth 5 billion euros.
    Portugal has already sold stakes in Energias de Portugal to Chinese investors and a part of electricity network REN to China and Oman.
    The country has launched the process to sell national airline TAP and airport operator ANA.
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