PORTUGAL: Prime Minister Jose Socrates says his government has no plans to seek a bailout from the EU and IMF

Record ID: 588923

  • Title: PORTUGAL: Prime Minister Jose Socrates says his government has no plans to seek a bailout from the EU and IMF
  • Date: 12th January 2011
  • Summary: LISBON, PORTUGAL (JANUARY 11, 2011) (REUTERS) EXTERIOR OF PRIME MINISTER OFFICIAL RESIDENCE PORTUGAL AND EUROPEAN UNION FLAGS PORTUGUESE PRIME MINISTER JOSE SOCRATES AND FINANCE MINISTER TEIXEIRA DOS SANTOS ARRIVING FOR NEWS CONFERENCE CAMERA OPERATOR (SOUNDBITE) (Portuguese) PORTUGUESE PRIME MINISTER, JOSE SOCRATES, SAYING: "The comparison between the (budget) execution result and the forecast in the budget, we have here a budget leeway of 800 million euros, or 0.5 percent of the GDP. These are the most important data of the budget execution and which surpass our expectations." CAMERAS (SOUNDBITE) (Portuguese) PORTUGUESE PRIME MINISTER, JOSE SOCRATES, SAYING: "The country is doing its work, it is doing it well. This is possibly the first result that the country presents as a stimulus for the confidence in international markets, in the financing of the economy." CAMERA OPERATOR (SOUNDBITE) (Portuguese) PORTUGUESE PRIME MINISTER, JOSE SOCRATES, SAYING: "I would like to highlight again that the Portuguese government and Portugal will not request any financial help or assistance for the simple reason that it is not necessary. Portugal has conditions to finance itself in the markets. Portugal is determined to do its work, which is already began last year, and which will continue in 2011." NEWS CONFERENCE (SOUNDBITE) (Portuguese) PORTUGUESE PRIME MINISTER, JOSE SOCRATES, SAYING: "Portugal will finance itself in the market. And that market includes the classical operations of auction of our debt in the market, and we are very confident that tomorrow's operation will go well, with the confidence of the markets in country's capacity to respond to its challenges, though with the context of worsening spreads around the world, but what the country decided was to diversify its financing sourcing and nothing more than that." PORTUGAL AND EUROPEAN UNION FLAGS SOCRATES AND TEIXEIRA DOS SANTOS LEAVING PORTUGAL AND EUROPEAN UNION FLAGS
  • Embargoed: 27th January 2011 12:00
  • Keywords:
  • Location: Portugal, Portugal
  • Country: Portugal
  • Topics: International Relations,Finance
  • Reuters ID: LVABR2GZYD9BZBW0ZB16J2QMD5SG
  • Story Text: Portuguese Prime Minister Jose Socrates attempted on Tuesday (January 11) to put a floor under persistent talk that his country will seek an international bailout, saying there are no such plans and that the 2010 budget gap was lower than its goal.
    He cited preliminary data as showing the budget deficit ended 2010 below the target of 7.3 percent of gross domestic product promised to Brussels, meaning that the country cut its deficit by more than 2 percentage points from 2009's highs of 9.3 percent.
    "The country is doing its work and is doing it well... Portugal is one of the countries in Europe that cut its deficit most in 2010," Socrates told reporters. "I'd like to point out that the Portuguese government and Portugal will not ask for any aid or financial assistance for the simple reason that it is not necessary."
    Portugal is seen by economists as the country most likely to follow Greece and Ireland in seeking international support in a widening euro zone debt crisis.
    Central bank board member, Teodora Cardoso, was quoted as saying on Monday that Lisbon would do better to seek international financing, breaking ranks with political leaders.
    "It would be easier if we had foreign help because this would mean that the adjustment would not be so abrupt, but if we do it alone, for the markets to believe in it, it has to be brutal," Cardoso said, according to news agency Lusa.
    Socrates said the country would keep financing itself in markets and was confident about Wednesday's bond offering of up to 1.25 billion euros.
    "This placement is going to run well," he said. Calling the deficit reduction, "an excellent result for Portugal", Socrates said that higher-than-expected revenues and more controlled spending created budget leeway of 800 million euros, or 0.5 percent of GDP last year.
    This year's target is even more ambitious as the government plans to slash the deficit to 4.6 percent of GDP after adopting a range of painful austerity measures such as wage cuts for civil servants and higher taxes.
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