[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
Italy struggles to deal with growing flood of migrants willing to risk their lives to reach the nearest European shores.
Israel's Operation Protective Edge is the third major offensive on the Gaza Strip in six years.
Muslims and Arabs in the US say they face discrimination in many areas of life, 13 years after the 9/11 attacks.
At one UN site alone, approximately four children below the age of five are dying each day.
Featured
More than fifty years of an armed struggle for independence from Spain might be coming to an end in the Basque Country.
After the shooting-down of flight MH17, relatives ask what the carrier has learned from still-missing MH370.
Human rights and corporate responsibility prompt a US church to divest from companies doing business with Israel.
Afghan militias have accumulated a lengthy record of human-rights abuses, including murders and rapes.
Growing poverty is strengthening a trend among UK Muslims to fund charitable work closer to home.
join our mailing list