Portuguese businessman Gilberto Jordan observes his country's attempts to strengthen its economy with mixed feelings.
On the one hand, the austerity measures that the government agreed with the European Union and the International Monetary Fund are “just the right ones,” says the head of the Andre Jordan Group, which specializes in tourism and real estate.
But on the other hand, “we are all afraid, very afraid” of the social consequences of the spread of poverty, the 50-year-old told dpa.
The EU and IMF granted Lisbon a bailout of 78 billion eros (110 billion dollars) in May. The loans are tied to strict conditions including spending cuts, privatizations and structural reforms.
Portugal needs to trim its budget deficit to 5.9 per cent of gross domestic product this year - a task that now appears more difficult, after it turned out that the first six months' deficit was higher than expected at 8.3 per cent.
Conservative Prime Minister Pedro Passos Coelho is on the right track to improve Portugal's competitivity and economic structures, Jordan believes.
The heavy bureaucracy and inflexible labour market were “like a heavy ball tied to the ankle” of the country's entrepreneurs, he said.
Yet while the EU, IMF and rating agencies praise Passos Coelho's policies, there is growing concern about their social consequences.
Braga archbishop Jorge Ortega, for one, urged the government “not to close its eyes from social tensions.”
It will be difficult to avert unrest for a long time, the respected clergyman warned, calling for a fairer social order.
The trade union confederation CGTP has called a week of strikes and work stoppages from October 20-27, saying it expected hundreds of thousands of people to join the protests.
Increasing numbers of people are suffering hunger in Western Europe's poorest country, cautions Antonio Marques, president of the Catholic aid organization Caritas in the northern city of Porto.
“The number of families coming to us for foodstuffs such as milk, rice or noodles has soared” from 312 to 513 families between January and August, he says.
“In the countryside, we help each other, leaving economically distressed neighbours a few bread loaves and milk at the doorstep,” a pensioner named Rita said in Idanha-a-Nova in central-eastern Portugal.
While growing numbers of young people emigrate, there is concern about the older generations. Half of Portuguese aged between 55 and 64 years are unemployed, according to official figures. About 80
per cent of retired people live on less than 800 eros a month.
Companies are also feeling the squeeze. The number of accepted bankruptcy filings grew by 60 per cent to 2,195 cases in the first quarter, compared with the corresponding period in 2010.
In the construction sector, 70,000 people were sacked in the first half of this year, while investments fell by 8.2 per cent. In the car industry, the number of personal vehicles sold plunged by 22.5 per cent by the end of August.
Worst of all, there is a sense in the country that if the austerity undermines economic growth too much, and Portugal does not meet its targets, all the sacrifices could be in vain.
There was a danger that Portugal might need a second bailout, President Anibal Cavaco Silva warned recently, while the far-left opposition believes Portugal could become “a second Greece.” - Sapa-dpa
Sean are you by any chance a brazilian with a inferiority complex or something ? Clearly you have no idea what you are speaking about if Portugal with a pib per capita equal to South Korea is a third world country then what would you call countries like Brazil with 10k ? Also Europe bought Portugal ? Really last time i checked one of the most problematic problems of Portugal was the difuculty of europeans toinvest in the country due to proteticionism.
Sean Hammon, wrote
Portugal was poor and third world to start with. Europe bought them and Portugal wasted the money.
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