Eu warns portugal:do not deviate from the savings course

Eu warns portugal:do not deviate from the savings course

"Any deviation from the objectives of the program or their renegotiation would undo the efforts already made by the portuguese citizens," the eu commission stressed.

German finance minister wolfgang schauble (CDU) pointed out on monday on bavarian radio that portugal had made great progress in recent years and was in the process of gaining access to the financial markets. After the constitutional court in lisbon declared parts of the austerity program inadmissible, the state now has to make new cuts.

Portugal’s prime minister, pedro passos coelho, had announced the previous evening new cuts in social security, health, education and state-owned enterprises. These measures were intended to compensate for the austerity measures that the judges had ruled unconstitutional. The center-right government will do everything in its power to prevent the euro crisis country from having to submit a second request for assistance to the EU.

The constitutional court’s ruling will leave a gap of around 1.3 billion euros in portugal’s 2013 budget.

The EU commission stressed that brussel trusts that lisbon will quickly present the necessary measures to adjust the budget in accordance with the agreements reached with the "troika" of the EU, the european central bank and the international sovereign wealth fund. "The budget targets must be met," said the spokesman for EU preservation commissioner olli rehn.

Regarding the debated maturity extension of aid loans from the EFSF bailout fund, the spokesman said that this was a matter for the eurogroup. The commission would be in favor if the fulfillment of the program is guaranteed. The issue was discussed at the informal meeting of european finance ministers in dublin on friday.

Opposition parties in portugal rejected announced savings and called for new elections. "The government is acting as if portugal were not a sovereign country," said socialist party spokesman joao ribeiro. "This attitude prevents portugal from negotiating fairer conditions"."

The federal ministry of finance in berlin, on the other hand, praised the efforts of the portuguese to implement the reform program in an exemplary manner. The portuguese government’s signal that it wants to remain committed to the austerity program can only be buried, said finance ministry spokesman martin kotthaus. "They (the portuguese) have achieved a lot. But trust is hard won. It should not be gambled away."

Portugal received a 78-billion-euro aid package from the troika in 2011. In return, the poorest country in western europe had to commit itself to a drastic austerity policy with the lenders in order to reduce the budget deficit and to reorganize the state finances.

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