Second bailout being discussed

piresdelimaThe Socialist Party declined today to go over in detail the recent rabble-rousing statements made by former PM and former President of the Republic, Mário Soares.

"To infer that violence is at the door is an inference from Dr. Mário Soares and we have no direct comment, but we should carefully read the signs that Portuguese society has been giving out and its disappointment at the austerity measures," said the PS national secretary.

Former head of state Mário Soares had called again for the dismissal of the President and of the Passos Coelho government, saying it is time to "go to their homes" and avoid "a wave of violence."

The Socialist Manuel Alegre believes that the Portuguese now feel a certain sense of being 'orphaned' by the current policies.

The socialists are annoyed at the current president Cavaco Silva, noting that "attacks have been made about the silence of the President, the ultimate guarantor and defense of our Constitution.”

“All this creates a feeling of abandonment and a lack of reference points in the country. That's what makes people to turn to former Presidents who were able to resolve the political crises of their times," added Alegre – “we are political orphans.”

The new Economy Minister, businessman Pires de Lima, has found his voice after a few months in office and despite his defeat over restaurant VAT, which he wanted reduced to 13%, he felt empowered to lay into the socialist opposition and Dr Spoares with barely concealed venom.

Pires de Lima criticised the lack of a constructive and realistic opposition from the PS, which has become hostage to the policy of just saying 'no.' "The PS is becoming hostage to a political position which relied on just saying ‘no.’” said the minister and called the group attending the conference organised by Mário Soares last week, Pires de Lima spared no criticism, saying the group is becoming 'pathetic' but supported the socialists for declining to comment on Soares’s calls for violence.

"I have no fear of the violence that is talked about at the group that meets regularly under the leadership of Dr. Soares. It is rather pathetic - they think themselves masters of democracy. This represent the future?" he posed, adding that he regretted that the socialists "can not find a political space that allows them to be a more realistic and constructive opposition.”

Pires de Lima stressed today that the budget for 2014 is "credible" but that Portugal needs to communicate better with its investors.


"Today, we have been talking about the level of growth we will have next year, the level of unemployment and the way to end this bailout programme in 2014 without any need for a protective mechanism, or with the need
for a protective mechanism."

For the man in charge of the economy to suggest that a second tier support structure may indeed be needed when Portugal finishes with the Troika next June goes against the party line and is the first indication that all may not be as fiscally rosy as the coalition keeps telling the electorate.

Regarding business, Pires de Lima does believe that tax reforms initiated by the Passos Coelho government will give the country "the most competitive regime in Europe.” The lowering of corporation tax, the minister believes, will encourage Portuguese companies that moved their headquarters out of the country, especially to Holland, to return to Portugal.

This too is a departure from the government line that the top Portuguese companies that have moved their head offices abroad had not done so to reduce their taxes. Had the moves not been tax efficient they would hardly have done so.