Ovi -
we cover every issue
worldwide creative inspiration  
Ovi Bookshop - Free Ebook
Ovi Greece
Ovi Language
Ovi on Facebook
The Breast Cancer Site
Tony Zuvela - Cartoons, Illustrations
International Red Cross and Red Crescent Movement
BBC News :   - 
iBite :   - 
Portuguese report Portuguese report
by Euro Reporter
2011-08-15 08:20:25
Print - Comment - Send to a Friend - More from this Author
DeliciousRedditFacebookDigg! StumbleUpon
Soros suggests Greece, Portugal quit euro-zone

George Soros, the US speculator turned billionaire philanthropist, has suggested both Greece and Portugal quit the European Union and the euro-zone because of their massive debts. "One has so mishandled the Greek problem that the best way forward at present might be an orderly exit" with Greece leaving both the EU and the euro common currency, he said in an interview published Sunday by the German magazine Spiegel. He suggested the same might go for Portugal. "The EU and the euro would survive it," he added.

Debt-stricken Greece and Portugal are struggling to implement eurozone and International Monetary Fund-mandated reforms, by slashing spending and raising taxes in exchange for financial aid. Soros also suggested the time had come for eurozone members to accept the introduction of Eurobonds. "Whether you like it or not, the euro exists. And for it to function properly, countries sharing the currency must be able to refinance a large part of their debt under the same conditions.

Berlin is opposed to the introduction of such bonds, but Soros suggested Germany, as Europe's strongest financial partner, should be responsible for defining the rules for its introduction. Soros, who made over $1 billion by betting against the British pound in 1992, also said he had no intention of playing the market against the common European currency. "I am certainly not betting against the euro. Because the Chinese have a huge interest in an alternative to the dollar and will do everything possible to help Europeans save it," he said. Both Greece and Portugal, along with Ireland, have been granted multi-billion EU-IMF rescue loans to prevent them from defaulting on their huge debts.


Portugal praised for progress on financial overhaul

The new Portuguese government has made “a good start” to lowering its budget deficit and meeting the economic overhaul pledged in return for a bailout of 78 billion Euros, or $111 billion, the country’s financial rescuers said Friday. But as international lenders were delivering an upbeat review of Portugal’s progress, the country’s finance minister announced a steep increase in the tax on electricity and natural gas consumption to ensure that Portugal cuts its budget deficit this year by more than a third.

Vitor Gaspar, the Portuguese finance minister, warned that the government was still short of its deficit-to-gross domestic product goal for the full year, by about 1.1 percentage points. To be on track, he said Friday, the government needed to increase its tax proceeds by an additional 100 million Euros ($142 million) in the fourth quarter by raising the value-added tax on electricity and natural gas to 23 percent from 6 percent.

Still, officials from the International Monetary Fund, the European Commission and the European Central Bank said during a televised news conference in Lisbon that they were confident Portugal would meet its goal of reducing its budget deficit to 5.9 percent of G.D.P., from 9.1 percent in 2010. “We have observed some public expenditure overruns, but we don’t expect these to continue in the fourth quarter,” said Jürgen Kröger, the chief negotiator for the European Commission.


Portugal attempts asset sales at 'worst of times'

Portugal may have to brave the most turbulent stock markets in three years as it seeks buyers for state-owned assets to meet the terms of its bailout package. Prime Minister Pedro Passos Coelho in the third quarter is seeking to sell holdings in power company EDP-Energias de Portugal SA and grid operator REN-Redes Energeticas Nacionais SA, which have a combined value of 2.17 billion Euros. Under its 78 billion-euro ($112 billion) European Union-led rescue, Portugal agreed to speed asset sales through 2013.

Europe's debt crisis and a faltering U.S. recovery and credit-rating cut are fuelling market turmoil. Benchmark stock indexes saw their biggest slump since Dec. 2008 before the Federal Reserve said on Aug. 8 that it's prepared to bolster the economy, sparking the biggest surge in the Standard & Poor's 500 Index since March 2009. "It's clearly the worst of times to carry out privatizations," Andre Pinheiro, who helps oversee 100 million Euros of assets at Orey Financial SA in Lisbon, said by phone. "Market instability won't help."

Portugal's 10-year bond yield was at 10.4 percent, down from a euro-era record 13.44 percent on July 11, after the European Central Bank bought Italian and Spanish debt for a third day to tame borrowing costs. The nation's two-year bonds yielded 11.5 percent, indicating higher perceived risk in lending to Portugal for two years than for a decade.

Print - Comment - Send to a Friend - More from this Author

Get it off your chest
 (comments policy)

© Copyright CHAMELEON PROJECT Tmi 2005-2008  -  Sitemap  -  Add to favourites  -  Link to Ovi
Privacy Policy  -  Contact  -  RSS Feeds  -  Search  -  Submissions  -  Subscribe  -  About Ovi