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Portugal PM warns opposition not to cause crisis over debt

Published on 14/03/2011

Portuguese Prime Minister Jose Socrates Monday warned his opponents not to provoke a political crisis over planned austerity measures to solve the country's debt crisis.

“A political crisis at this moment would weaken our country and would prevent Portugal showing that it is a country capable of solving its problems without recourse to outside help,” he said in a televised speech.

On Friday, shortly before a eurozone summit opened in Brussels, the minority socialist government headed by Socrates announced new austerity measures, winning the applause of the European Commission, the European Central Bank and the German government.

He has sought to fight back against mounting pressure and expectations that Portugal would be the next in line, after Greece and Ireland, to turn to the International Monetary Fund (IMF) and the European Union for a rescue.

Despite austerity measures to cut its public debt, borrowing costs have been mounting over the past several weeks on bond markets, making it increasingly difficult for Portugal to raise money.

“The backing we have got from the European institutions is absolutely basic to achieving our chief national aim: to avoid Portugal being forced to have recourse to a programme of outside aid,” he said.

The main Portuguese opposition party, the centre right Social Democrats (PSD), backed earlier austerity measures “in the national interest.”

But it has said it will not vote for a new package.

Both Greece and Ireland also denied they needed aid before eventually seeking financial lifelines from the IMF and European Union.