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Portugal passes on final bailout payout

Portugal’s government decided Thursday to do without a final 2.6 billion euros ($3.5 billion) in funds due under its international bailout programme, which ended last month.

Finance Minister Maria Luis Albuquerque said following a government meeting that it was decided “not to request a new extension of the programme and thus not receive the final instalment of the programme”.

In May, Portugal exited a three-year, 78-billion-euro bailout programme, but the final instalment of aid funds was still pending from its international creditors — the European Union and the International Monetary Fund.

Payment of the funds had been put on hold following a court ruling that invalidated some cost-saving measures to give the government time to figure out other ways to reach its budget targets.

Albuquerque said: “A reopening of the programme would lead to a loss of credibility for the country and could put at risk the progress achieved so far.”

Portugal demonstrated on Wednesday that it can finance itself affordably on the markets by successfully raising 975 million euros in its first benchmark 10-year debt issue since exiting the bailout programme in May.

The amount exceeded by a wide margin its target of raising 500 million-750 million euros, and the 3.25 percent rate of return was sharply down from 3.57 percent when it issued 10-year debt on April 23.