Portuguese creditors give Lisbon good marks: minister

Portugal has received another passing grade from its creditors following a regular review of a May 2011 aid plan backed by the European Union and International Monetary Fund, Finance Minister Vitor Gaspar said on Monday.

The “success” of the sixth review paves the way for payment of another 2.5 billion euros ($3.2 billion) from a total package worth 78 billion euros, Gaspar told a press conference.

A mission of auditors from the EU, IMF and European Central Bank, commonly known as the troika, “concluded that the Portuguese adjustment continues to progress, despite a deteriorating situation and perspectives for the European and global economies,” he said.

“The Portuguese programme’s strong ability to apply agreed-upon measures was also underlined,” the finance minister added.

In September, the last positive review led to an easing of Portugal’s deficit-reduction targets, with Lisbon now expected to trim its public deficit to 5.0 percent of gross domestic product (GDP) this year instead of 4.5 percent as initially envisioned.

In 2013, Portugal will be expected to hit the 4.5-percent level, rather than 3.0 percent, the theoretical upper limit for EU countries that Lisbon hopes to reach in 2014.

The government aims to save 4.0 billion euros via state reform measures, but its austerity budgets have led to howls of protest from civil servants and trade unions in particular.