Friday, November 26, 2010

Parliament to vote on austerity measures

Big day in Lisbon following Wednesday's shut-down. Parliament will vote on the Socialist government's plan to introduce highly unpopular austerity measures, including pay cuts for civil servants, lower welfare benefits and an increase in value-added tax to 23 percent.

If passed as expected, the measures will be introduced on 1st January.

The vote comes the day after a lengthy European Commission report on the labour market shows that by working longer hours for the same money workers in Portugal have helped the country weather the current financial crisis better than some other member states.

Although unemployment stands at nearly 11 percent, the average hours worked per person has increased and this has boosted productivity.
The government hopes the austerity measures starting on 1st January will help solve the country's debt crisis and quell speculation that Portugal will be next, after Ireland and Greece, to request an international bailout.

Prime Minister Jose Socrates insists that the economic situation in Portugal is very different to that in Greece and Ireland and that this country does not need a lifeline from the European Union and International Monetary Fund.

Yesterday, investors kept up pressure on Portugal amid fears that we could be the next victim of the current 'contagion' crisis. If Portugal succumbs, Spain is likely to be next. The focus may then shift to Italy.

The Russians may be coming

News that Britain's second biggest tour operator, Thomas Cook, has bought a controlling interest in the huge Russian travel company, Intourist, brings a ray of hope for an improvement in the number of visitors coming to the Algarve next year.

The deal is expected to enable Thomas Cook to meet the growing demand in Russia for holidays in the sun. Egypt and Turkey are likely to be the biggest beneficiaries, but the Algarve may pick up a significant amount of business.

More than six million Russians went on overseas packaged holidays last year. The market is expected to grow by a double-digit percentage in the coming years, according to a statement from Thomas Cook.

This is refreshing news in the wake of Thomas Cook's cancellation of package holidays to the Algarve this winter. They will not resume until April.

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