Portugal gets pass mark from bailout providers

The representatives of the so-called troika, the IMF, the European Commission and the European Central Bank, have approved the Portuguese government’s implementation of the measures agreed in exchange for its 78-billion-euro bailout.

As a result, Portugal will receive another 5.5-billion-euro tranche of the bailout.

Portugal had asked the troika to relax its deficit-reduction program in order to take better advantage of an incipient recovery, but the IMF, the ECB and the EC insisted the target for this year should remain at 4 percent of GDP rather than the 4.5 percent Lisbon was seeking.

Deputy Prime Minister Paulo Portas told a news conference on Thursday that signs of an expected turnaround in the domestic economy are still somewhat “tenuous but persistent.” They were, however, significant enough for the government and the troika to revise the growth forecast for next year to 0.8 percent of GDP from 0.6 percent previously and to lower the estimate for unemployment to 17.7 percent from 18.5 percent. “We’re entering a recovery phase,” said Finance Minister Maria Luís Albuquerque.

Despite reports to the contrary, Portas said no new austerity measures are in the pipeline for next year. Portugal is due to exit the bailout program in June of next year. “We are three inspections by the troika [...] away from recovering our sovereignty,” Portas said.