LISBON: “I won’t be joining any group that may be proposed to restructure the debt,” Mr. Pedro Passos Coelho told lawmakers in parliament after one of them said the new Greek government planned to call for an European conference to discuss the issue. He added that Portugal’s debt is sustainable.
Portugal exited a 78 billion euros ($88.6 billion) bailout program in May last year after imposing three years of austerity that sank the economy and increased unemployment. The country is now growing again and unemployment is falling, but the debt level is still high, above 125% of gross domestic product.
Mr. Passos Coelho, who has always defended the reforms and public service cuts that highly indebted countries have made to make their finances sustainable, said Portugal, along with Ireland and Spain, has done its homework and therefore wouldn’t be willing to scare off investors with debt-restructuring talks.
“These countries have high debt, but they are sustainable,” he said.
Portugal will hold elections in the second half of the year. Mr. Passos Coelho’s Social Democratic Party is placed second in current opinion polls, behind the Socialist Party.
While the Portuguese Socialists are in favor of deficit controls and in fulfilling commitments with lenders, the party has called for an end to the eurozone’s age of austerity. Earlier this week the party’s leader, Antonio Costa, said the result of the Greek elections, which put left-wing Syriza in power, “is a sign of change in the political orientation of Europe, of how austerity policies have reached a limit and of the necessity of new policies.”
