Portugal to ask for EU aid after political talks: report

Portugal’s caretaker government will only make a formal request for financial assistance from the European Union after talks with the opposition on the terms of any deal, the Lusa news agency reported Thursday.

Socialist Prime Minister Jose Socrates announced on Wednesday that the government had finally decided to seek EU help, paving the way for a third bailout of a eurozone country after Ireland and Greece last year.

Lusa, citing a government source, said “the government and the political parties must still decide what guarantees will be offered by Portugal.”

“No date has been set to deliver the request and there is no commitment to do it during the” meeting of EU finance ministers that begins in Budapest on Friday, the government source told Lusa.

European Commission President Jose Manuel Barroso confirmed late Wednesday that he had been informed by Socrates “of his intention to request the activation of financial support mechanisms” of the EU.

Barroso said the request would “be examined as soon as possible.”

Parliament was dissolved after the collapse of Socrates’ government on March 23 when MPs rejected his austerity plan aimed at balancing the country’s strained public finances. New elections are scheduled for June 5.

The head of the main opposition Social Democratic Party, Pedro Passos Coelho, said late Wednesday he supported the planned request for aid, promising to “facilitate” negotiations with the outgoing government.

“Until the elections of a government that is sufficiently strong and credible to negotiate a more complete aid package, in the medium- and long-term, it is essential that the current government can negotiate a minimum aid package,” he said.

Polls show Coelho winning the June elections.