Angola “exodus” threatens Portugal’s economic recovery

“Relative optimism” expressed by financial markets over the last few months could be blown away in a trice , warns an economic report revealed yesterday (Thursday).

Risk Outlook, drawn up by market regulator CMVM, lists threats for Portugal that are already coming true.

Diário de Notícias, for instance, reports today that 500 Portuguese workers are returning home from Angola every month as a result of the financial crisis brought on by the fall in the price of crude.

And as Angola’s economy implodes, Portugal’s traditional exports to the African country are drying up.

Another serious worry is the near impossibility of getting money out of Angola.

Exports to Brazil too have also taken a turn for the worse – meaning Portuguese workers there could also start heading home.

“If perspectives don’t change rapidly, the situation could mean further degradation in the profitability of small and medium sized companies and lead to a significant return of work-age people”, CMVM explains, stressing that “faced with the slow creation of employment in Portugal”, this return could “create additional tensions for Portugal’s Social Security and prejudice the economic recovery, which is in itself fragile”.

As if this wasn’t enough, the report alludes to the “continuing growth of sovereign debt”, as well as high external debt, and a banking sector where profitability “continues to be an important threat to Europe’s financial and economic stability”.

Very much the pin to pop a proverbial balloon, the report concludes that contingency measures – like reinforcing banks and stimulating the economy – “are proving difficult to achieve”.

Commenting on the assessment, construction sector union representative Albano Ribeiro told DN that none of this is new – and the consequences will take unemployment in Portugal “much higher”.

Representing thousands of workers affected by the slump in Angola, Ribeiro told the paper: “We’re asking for an urgent audience with the Secretary of State for the Communities because we have some situations where wages are four months in arrears, and workers cannot manage to survive”.

At risk in the country right now are over 200 companies leaving “more than 220 million in debts”, he said.

The only light at the end of the tunnel was the fact that one day all Angola’s unfinished building projects “will have to be completed”.

For now, markets like Mozambique may be the answer, “as there are no problems there”, he told DN.

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