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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (94412)	9/10/2012 11:27:56 AM
From: elmatador	Respond to of 217780

Lisbon announces harsher austerity plans announced after Lisbon acknowledged in August that it would be all but impossible to meet this year’s budget deficit goal of 4.5 per cent of economic output after tax revenue in the first seven months fell €2.85bn below target. By Peter Wise in Lisbon Portugal’s prime minister has announced new austerity measures involving a sharp cut in take-home pay for private and public sector workers designed to keep the country on track to comply with its €78bn bailout programme. In a televised address, Pedro Passos Coelho said on Friday that the social security contributions deducted from employees’ wages would increase from 11 to 18 per cent in 2013.The centre-right coalition government would at the same time reduce the social security contributions made by companies from 23.75 per cent to 18 per cent of their wage bills in an effort to make Portuguese exports more competitive by cutting labour costs. In spite of recent progress, Portugal continued to face a “financial emergency”, Mr Passos Coelho said. “We cannot risk sliding back or hesitate in confronting the challenges ahead of us.” Opposition parties and trade unions vehemently condemned the new measures. Accusing the prime minister of being “obsessed with austerity”, Carlos Zorrinho, a senior Socialist party official, said the package would deepen the country’s recession and increase unemployment. The economy is expected to contract by more than 3 per cent this year, while unemployment has climbed above a record 15 per cent. Mr Passos Coelho announced the new measures a few days before Portugal’s international lenders – the “troika” of the European Commission, International Monetary Fund and European Central Bank – were due to conclude an assessment of Lisbon’s progress with the adjustment programme. The prime minister said the announcement on Thursday of ECB plans to support struggling eurozone economies, including Portugal, through potential government bond purchases would “facilitate our adjustment”. But it would be a “serious mistake” to think that possible ECB assistance could replace the economic reforms and fiscal consolidation that Portugal had to achieve through its own efforts. Mr Passos Coelho had previously proposed cutting Christmas and summer holiday bonuses – each equivalent to a month’s pay – for public sector workers, but the constitutional court ruled that it discriminated against state workers. The government will now cut only one of these bonuses for public employees. But both will be deducted from state pensioners. Additional unspecified tax measures affecting wealthy individuals and big company profits would also be proposed in the government budget for 2013, the prime minister said. The new austerity measures were announced after Lisbon acknowledged in August that it would be all but impossible to meet this year’s budget deficit goal of 4.5 per cent of economic output after tax revenue in the first seven months fell €2.85bn below target. Earlier a senior official in the prime minister’s Social Democrat party (PSD) said the ECB bond purchasing plan was not a guarantee that Portugal would be able to return to the debt market next year as scheduled under its bailout agreement. “Our return to the market depends on our capacity to continue complying with our adjustment programme through fiscal consolidation and structural reform,” said Jorge Moreira da Silva. His comments to reporters late on Thursday signalled that Lisbon remained determined to push ahead with deeper austerity measures despite the insistence of the Socialist opposition that the promise of potential ECB assistance gave the government room to ease fiscal pressures. Economists have expressed fears that Portugal will not be able to inspire sufficient confidence in investors to resume issuing long-term debt by September 2013, as required under its bailout agreement. The issue of whether Portugal will need more time to pay and possibly more bailout money has become increasingly pressing as, to continue disbursing funds, the IMF requires countries to demonstrate credible financing plans for 12 months ahead. Mario Draghi, the ECB president, said on Thursday that “outright monetary transactions”, or government bond purchases, “may also be considered” for eurozone countries already under adjustment programmes – Greece, Ireland and Portugal – “when they will be regaining bond market access”. António José Seguro, leader of the centre-left Socialists, the main opposition party, said the potential intervention of the ECB was an assurance that Portugal would be able to resume issuing long-term government bonds by September 2013. This would significantly lower Portugal’s financing costs and bring down the budget deficit, enabling the government to ease austerity. “The decision announced by the ECB will alleviate [the pressures] on the Portuguese people and Portuguese companies,” he said. However, Mr Moreira da Silva of the PSD insisted that “it’s not true that the [ECB] decision guarantees Portugal’s return to the market in 2013. It was not the incapacity of the ECB that forced Portugal to seek a bailout, it was erroneous fiscal policy.” He said the fact that Portugal’s bond yields had fallen over recent months to pre-bailout levels reflected international recognition of the government’s deficit-reduction measures. The yield on Lisbon’s benchmark 10-year debt fell to 8.67 per cent shortly after Mr Draghi’s announcement, the lowest level since April 2011, a month before Portugal’s then Socialist government requested the bailout. Copyright The Financial Times Limited 2012. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.

To: Haim R. Branisteanu who wrote (94412)	9/10/2012 1:30:25 PM
From: Haim R. Branisteanu	Read Replies (2) \| Respond to of 217780

Why it is good to be a politician - no difference between them and the thieves and swindlers on WS - how sad - after all who paid the fees to Tony Blair? the shareholders of course, without even being asked Tony Blair got about $1 million in fees for attending a meeting between Glencore International Plc Chief Executive Officer Ivan Glasenberg and Qatar’s Prime Minister Hamad bin Jassim bin Jabr Al Thani, Sunday Times says, citing sources close to the matter.