As the latest €910 million tranche of bailout money arrives, Passos Coelho is reported to have informed the Troika that Portugal is working on how it can make a clean exit from its adjustment programme in May.
The idea is to study the path followed by Dublin in the last few months of Ireland’s programme, writes Diário Económico, and plot a similar strategy.
The groundwork will start being prepared next week as the Troika arrive back in Portugal for the 11th and penultimate review of the country’s performance under the three-year bailout programme.
Confidence at highest level for 4-5 years
Meantime, economy minister Pires de Lima gave a buoyant interview on SIC TV, saying the climate of confidence in Portugal is at its highest level “for the last four to five years”.
Lima dismissed opposition criticism that the economic upturn has failed to trickle through to the population as a whole, saying “this is the time to build” (metaphorically) on the country’s success.
He agreed that “the indicators of economic recovery haven’t yet arrived in the lives of people who are paying a high price in terms of unemployment, reduction in salaries and increased in taxes” but this is all necessary for Portugal to “succeed” in its process of adjustment and “re-launch the economy”.
IMF: No let-up in sight
Reading between the lines, it appears there will be no let-up in ongoing policies of austerity.
The IMF’s official statement as it injects the latest multi-million-euro cash advance, warns:
“Pressures to increase public expenditure should be resisted, and efforts to rationalise public administration and narrow the gap between social transfers and contributions should be continued.”
Acknowledging Portugal’s efforts as “commendable”, the statement stresses that “further fiscal structural reforms, including in revenue administration and arrears control, are critical to maintain sustainable public finances and minimise budgetary risks”.
If that wasn’t clear enough, the IMF adds that Portugal’s “strong commitment” to the implementation of their adjustment programme remains “crucial”.
As this news comes in, RTT online news service reports that industrial output for Europe has failed to live up to expectations.
With the enigmatic headline “growth eases more than forecast”, the bottom-line is that industrial production in the Euro area as a whole, fell 0.7% – almost twice as much as economists had predicted.
