[QODLink]
Europe

Portugal government to stay in power

Portugal's president accepts compromise reached by the coalition government that ends a weeks-old political crisis.

Last Modified: 21 Jul 2013 22:35
Email Article
Print Article
Share article
Send Feedback
Portugal's President Anibal Cavaco Silva expects the move could complete Portugal's bailout programme [Reuters]

Portugal's president has accepted a compromise reached by the coalition government that allows it to stay in power, to end a weeks-old political crisis and keep an international bailout on target.

Ruling out early polls, President Anibal Cavaco Silva on Sunday said that he is opting for “the best alternative” which is “the continuation in office of the current government.”

“The coalition, which has overcome an internal rift that triggered the crisis in early July, has presented guarantees of a solid understanding on how to successfully complete the bailout programme and allow Portugal to return to full market financing,” Silva said.

The coalition almost split on July 2 when Foreign Minister Paulo Portas, the leader of the junior party, threatened to resign raising fears that Portugal would be unable to abide by the terms of its $102 billion international bailout.

The crisis had threatened to derail Lisbon's planned exit from the EU/IMF bailout, especially after talks on a broader political deal between the two coalition parties and the opposition Socialists collapsed on Friday.

But a compromise was reached within the coalition when Portas was appointed deputy to Prime Minister Pedro Passos Coelho—a move that required the president's agreement, which he gave late Sunday.

Positive move

Some observers have called the decision a positive one that would remove uncertainty among investors.

"I think it's a positive decision to calm down investors that removes uncertainty and maintains the drive of meeting the bailout goals," says  Rui Barbara, an economist at Banco Carregosa.

"In the eyes of investors, Portugal should return to the situation before the political crisis,” Barbara adds.

The government has a solid majority in parliament and last week easily defeated a no-confidence motion.

The main ruling Social Democrats (PSD) has said the government will press on with meeting fiscal goals for Lisbon to exit the rescue programme by mid-2014 as planned.

The austerity measures pursued under the bailout has stoked the worst recession in Portugal since the 1970s.

329

Source:
Agencies
Email Article
Print Article
Share article
Send Feedback
Topics in this article
People
Country
City
Organisation
Featured on Al Jazeera
At least 25 tax collectors have been killed since 2012 in Mogadishu, a city awash in weapons and abject poverty.
Tokyo government claims its homeless population has hit a record low, but analysts - and the homeless - beg to differ.
3D printers can cheaply construct homes and could soon be deployed to help victims of catastrophe rebuild their lives.
Lack of child protection laws means abandoned and orphaned kids rely heavily on the care of strangers.
Featured
Booming global trade in 50-million-year-old amber stones is lucrative, controversial, and extremely dangerous.
Legendary Native-American High Bird was trained in ancient warrior traditions, which he employed in World War II.
Hounded opposition figure says he's hoping for the best at sodomy appeal but prepared to return to prison.
Fears of rising Islamophobia and racial profiling after two soldiers killed in separate incidents.
Group's culture of summary justice is back in Northern Ireland's spotlight after new sexual assault accusations.