News / Europe

Portuguese Government Scrambles to Avert Political Crisis

People shout slogans during a protest by the Portuguese Communist party, demanding the breakup of the Portuguese parliament and early elections, in Lisbon, July 3, 2013.
People shout slogans during a protest by the Portuguese Communist party, demanding the breakup of the Portuguese parliament and early elections, in Lisbon, July 3, 2013.
TEXT SIZE - +
Selah Hennessy
— Portugal's leaders worked to save their coalition government Thursday after two cabinet members resigned. The political turmoil in Portugal has been rocking the markets, and analysts say it is a clear indicator the eurozone crisis is far from over.

A spokesperson for the Portuguese government said Thursday that talks between the prime minister and his coalition partners were taking place in a “very positive atmosphere.” No further details were given.

Prime Minister Pedro Passos Coelho was meeting with the leader of the rightist CDS-PP party to heal the rift that erupted after the country’s finance minister and foreign minister both resigned this week.

Their resignations follow widespread discontent over Portugal’s tough austerity measures.

Ramon Pacheco Pardo from the European and International Studies department at King’s College London says it is a change for the Portuguese government, which until now has appeared united in its austerity drive.

“This is a new move in Portuguese politics toward some people making it clear that they do not agree with the policies that they are being demanded to implement," he said. "So we see that the broader agreement that seemed to exist among the main political parties in Portugal does not really exist.”

At this point, he said, it is unclear what will happen, but if talks fail there could be new elections in the coming months.

The government is working to complete its $102 billion bailout next year. But its austerity drive, which is a requirement of the international loan, has forced the country even deeper into its worst economic slump since the 1970s.

Pardo said the government’s determination to pursue austerity might be crumbling.

And if Portugal begins a shift away from austerity, other European nations could follow.

“It is very likely that in other European countries, and we have seen this more openly in Greece for example, politicians might not be willing to carry on with these cuts,” said Pardo.

The markets reacted quickly to Portuguese political unrest. The Portuguese 10-year government bond yield spiked to eight percent on Wednesday - close to the levels reached two years ago, when Portugal was forced to seek a bailout.

Christian Schweiger, a Europe expert at Durham University, said the market reaction is worrying.

“This shows that the European crisis is definitely not over,” he said.

And he said Portugal is not on its own. Popular discontent over austerity is widespread across Europe, not least because of soaring unemployment levels among the youth. Schweiger said euro countries could see growing unrest.

“If you look at Cyprus for example, we have heard nothing of Cyprus in the last few weeks, but we do not know if a similar situation could not arise given that we had quite large protests against the austerity measures that Cyprus has to implement,” he said.

European Union and International Monetary Fund auditors are due to arrive in Portugal on July 15 to review the country’s progress on economic reforms. Those reforms are a prerequisite for Portugal getting the next tranche of its international loan.

You May Like

Photogallery Pope's Easter Prayer: Peace in Ukraine, Syria

Pontiff also calls for end to terrorist acts in Nigeria, violence in Iraq, and success in peace talks between Israelis and Palestinians More

Abdullah Holds Lead in Afghan Presidential Election

Country's Election Commission says that with half of the ballots counted, former FM remains in the lead with 44 percent of the vote More

Russia-Ukraine Crisis Could Trigger Cyber War

As tensions between Kyiv and Moscow escalate, so too has frequency of online attacks targeting government, news and financial sites More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid