Big week for Portugal and eurozone

It's the start of another big week in the midst of the current economic and financial crisis. Eurozone finance ministers are meeting in Luxembourg today and tomorrow. Portugal's new cabinet under Prime Minister Pedro Passos Coelho will convene on Tuesday. The prime minister will then attend a key European Union council meeting in Brussels on Thursday and Friday.

The new government here faces the massive initial task of navigating the country through what Coelho has referred to as two “terrible years” of deep recession and record unemployment.

At least the right-of-centre Social Democrats in coalition with the conservative CDS-PP party can look forward to a comfortable overall majority in the 230-member parliament. Coelho has kept to his promise and reduced the cabinet from 16 ministers under the previous Socialist administration to just 11 - four from the PSD, three from the CDS-PP and four independents.

One of the independents is Vítor Gaspar, the new finance minister. An economics professor, Gaspar has worked as a research director at the European Central Bank, led the European Commission's Bureau of Policy Advisers and most recently been a special adviser to Portugal's central bank. He will need all his experience and expertise in the daunting task he has taken on.

The main focus of the new government's work will be administering the tough and broad-ranging conditions of the EU/IMF rescue package, a consequence of a debt that had risen by the end of 2010 to €160 billion and a deficit for the year of 9.1 percent of GDP, more than triple the permissible EU rate first breached by Portugal back in 2002.

The meeting of EU finance ministers in Luxembourg is being dominated by the crisis in Greece, but they will also be taking stock of the Portugal's €78 billion bailout. Economic policy will again be top of the agenda in Brussels on Thursday and Friday. Warning that the ongoing debt crisis could spread to Italy and Belgium, Jean-Claude Juncker, who is chairing the eurozone finance ministers'' meeting, reportedly said yesterday: "We are playing with fire.”

In the light of the acute difficulties in Greece, one commentator said the other day: “Continuing to agree last-minute emergency measures to avoid the immediate collapse of a eurozone country is unlikely to create financial trust. And it is even less likely to create the required political trust to effectively tackle the crisis at its root. The EU heads of government and above all Merkel (the German Chancellor) need to take over the agenda and set out a credible narrative for a sustainable and prosperous eurozone or face the inevitable consequences.”

There has been an upsurge in fears about a possible collapse of the euro. Mind you, there has been talk of that ever since the common currency was introduced more than a decade ago. 

State of the nation on Portugal Day

June 10, Portugal's National Day honouring Luís Camões, who wrote the epic poem Os Lusíadas in celebration of the glorious 15th and 16th century explorations and achievements that brought the country such fame and wealth. How things have changed.

Saved on the verge of bankruptcy by an international bailout, Portugal today is a member of that group of countries humiliatingly referred to by international bond and currency traders as PIGS.

But not much has changed since last Sunday's general election in that the country still does not have a working government to get on with the job of administering the sweeping reforms demanded by the bailout conditions.

Urged by President Aníbal Cavaco Silva to start the process of forming a government as a matter of urgency, the Social Democrat prime minister-in-waiting, Pedro Passos Coelho, got around to opening formal coalition talks with the right-wing CDS-PP party on Wednesday. Even so, it's not expected he will be able to swear in a new cabinet for almost another two weeks. The hope is he will make it before a European Council meeting on June 23-24.  

Tax hikes, spending cuts and structural reforms are expected to follow. So are more job losses, strikes and public demonstrations. Today, a 24-hour strike by the staff of the national rail company has forced the cancellation of all passenger and freight services. 

Meanwhile, noting that money isn't everything, the Paris-based Organization for Economic Cooperation and Development (OECD) has produced a survey suggesting that Portugal has made significant progress over the last few years in improving the living standards of its citizens.

In a 'Better Life Index' survey covering its 34 member states, the OECD places Portugal 9th in terms of the balance between work and private life. In this regard, Portugal is way better off than Britain, for example, but well below Denmark, which always tops these sorts of lists.

In terms of employment, nearly 66% of people aged 15 to 64 in Portugal have a paid job. They work 1,719 hours a year, close to the OECD average. 67% of mothers are employed after their children begin school, suggesting, according to the orgnisation, that women are able to successfully balance family and career.

In terms of the life expectancy (79.3 years), environmental pollution, safety from crime and housing, the Portuguese fair reasonably well, but household earnings are less than the OECD average.

As to the quality of its educational system, the average student scored 489 out of 600 in reading ability according to the latest PISA student-assessment programme, lower than the OECD average. Only 28% of adults aged 25 to 64 have earned the equivalent of a high-school diploma, the lowest rate in the OECD, which stands at 72%.

The sense of community and civic participation in this country is only moderate, with 83% of people believing they know someone they could rely on in a time of need, lower than the OECD average of 91%.  Public trust in government is also low.

Only 36% of Portuguese surveyed said they were satisfied with their life, well below the OECD average of 59%.

Portugal swings to the right and braces itself for increased austerity

The pendulum swung even further to the right than predicted. It was the lowest turnout for the Sociatists of any general election in Portugal since 1987.

The number of abstentions yesterday was greater than the number of people who voted for the winning Social Democratic Party (PSD).

Abstentions totalled more than 40%. With less than 39% of the vote, the centre-right PSD will be able to form a government with an absolute majority in coalition with their traditional partners, the conservative CDS, who finished with nearly 12%.

Former Prime Minister José Sócrates stood down as leader of the Socialists who finished with just 28% having won the previous two elections, in 2005 and 2009.

The PSD leader Pedro Passos Coelho now has the task of overseeing tough, wide-reaching and highly unpopular reforms as laid down by the EU and the IMF in return for a three-year €78 billion bailout. Unpopular with the ordinary people, all the main parties supported the international rescue package.

Lower living standards and even greater hardships in one of western Europe poorest countries are now on their way. Tax hikes and welfare cuts are expected. It will be easier to hire and fire workers. And the EU/IMF are insisting on a raft of other measures which will plunge the country into recession for two years.

The new government has a clear mandate to impose this greater austerity. The Social Democrats will have 105 deputies in the 230-seat Parliament compared with 73 Socialists. The CDU will have 24.

Pedro Passos Coelho said last night his government would do everything in its power to overcome the great difficulties facing the country and not be a financial burden on Europe.


In the Algarve, the PSD won 37% compared with the Socialists' 23%. Of the nine Algarve deputies in the next parliament, four will be PSD, two Socialist and one each from the CDS, BE and Communist parties.

A general election devoid of joy

Disillusioned by politicians in general and knowing that hard economic times lie ahead whoever wins, Portuguese voters will go to the polls in Sunday's national election with little enthusiasm.

The new government will have little room to manoeuvre. It will have no choice but to abide by the EU/IMF bailout reform rules.

The most likely election result will be a coalition government formed by the centre-right Social Democrats (PSD) and the third strongest party, the conservative CDS. Opinion polls indicate the Social Democrats led by Pedro Passos Coelho will win more votes than the Socialists but not enough to be able to govern on their own.

The possibility of an inconclusive result fermenting a coalition involving the Socialists under former Prime Minister José Socrates is not being ruled out. It was the collapse of the minority Socialist government amid financial turmoil in March that led to this election.

Whatever the make-up of the new government, its main task will be to implement the tough and wide-ranging reforms demanded by the EU/IMF rescue package. These include increased taxes, deep cuts in spending and greater competitiveness.

In the election campaigning, none of the parties have been able to raise customary hopes of a better future. There is a strong perception that corruption, wealth and power, supported by a deeply flawed justice system, have brought this country to the verge of bankruptcy. 

The Bank of Portugal is on record as saying economic hardship will be particularly severe over the next two years. The young in particular are feeling deeply frustrated and are reportedly leaving the country in droves. Further strikes and street demonstrations can be expected in the weeks ahead.

Whatever the outcome this Sunday, there is unlikely to be much rejoicing in the land. 

Conman Ken on the run in the sun

A wily Welshman by the name of Kenner Elias Jones, a much convicted conman according to the BBC, is now believed to be operating in Portugal.

Charged with stealing thousands of pounds from an employer in the UK, Jones absconded from a crown court before his trial in the UK eight years ago. He has been on the run ever since.

Already convicted more than 60 times for theft, forgery and fraud, Jones has allegedly cheated several companies in Portugal.

Previously deported from Canada and the United States, he is wanted in Kenya where he is alleged to have debts of more than 100,000 dollars. He is said to have posed as a doctor in Kenya and to have administered medicines to children, even though he had no medical qualifications. It is claimed he also posed as a priest.

BBC Wales tracked him to Portugal and interviewed a travel agent in Palmela, south of Lisbon, who claimed Jones did not pay for tickets obtained for his family to join him in this country.

BCC Wales believe he is living in the capital but, of course, it is possible he has moved south to the Algarve and is trying to continue his 40-year criminal career here. 


For more, including images of Jones:
http://www.bbc.co.uk/go/em/fr/-/news/uk-wales-13607280 

Government issues statement on crime control in tourist areas of the Algarve

 Portugal's Ministry of Internal Administration says the forces of law and order are paying full attention to security in the Algarve and particularly in its most popular beach resort of Albufeira.

In a statement issued yesterday, the ministry says all reasonable measures are being taken to prevent and fight crime. It also points out that crime rates in this country are among the lowest in the EU and that crime in the Algarve region is decreasing.

The statement comes in the wake of alleged attacks on three holidaymakers, two fatal. Police are continuing to investigate the incidents in the Montechoro area of Albufeira. A gang of youths is suspected of involvement.

The internal affairs ministry says there was a slight decrease in crime in general and violent crime in particular in 2010 compared with the previous year. The drop has been much more marked in the first quarter of this year. Serious and violent crime was down 21.7%, and the number of robberies dropped by 20%. In the Albufeira municipality, there were 21.5% fewer violent crimes in 2010 than in 2009 and 9.7% fewer in the first quarter of this year.

Two thousand new police officers are being groomed for the various forces, a new security arrangement now links private home alarm systems to police stations and tighter border controls are in place. The statement emphasises that police presence, visibility and operational activity is being stepped up in popular tourist areas of the Algarve.

Meanwhile, police investigations continue into the death last month of a Scottish soldier, Darren Lackie, 22, and the stabbing of a holidaymaker from Dublin, David Hoban, 44. Police are also investigating the death of a tourist from the northeast of England, Ian Haggath, 50, who was brutally attacked a fortnight ago and has since died.

A spokesman for Britain's foreign office said yesterday it had made "a very minor" change to its travel advice to alert holidaymakers about street crime in the Algarve.

Tourists warned to be vigilant following street attacks in Albufeira

Portuguese police say they are still investigating recent street attacks on holidaymakers that have prompted the British Foreign and Commonwealth Office to amend its travel advice to tourists coming to Portugal.

Ian Haggath, 50, from Dunston, near Gateshead in the northeast of England, was ferociously attacked and left unconscious in a pool of blood in Albufeira a fortnight ago. He suffered serious head injuries and died in hospital last Wednesday. 

Described as "mild-mannered and friendly", Mr Haggath was attacked while walking back to his hotel in the early hours of the morning. It is thought he may have been the victim of a gang of youths.

There is speculation the same gang may have been responsible for the death in March of a British soldier, Darren Lackie, 22, from Cupar, Fife, and the non-fatal stabbing of an Irish tourist, David Hoban, 44, from Dublin.

A few minutes before Mr Haggath was set upon, another tourist is said to have been taunted, abused and had stones thrown at him by a gang of four.

Police initially treated Mr Lackie's death as the result of a drunken fall but a fresh inquiry was launched when medical reports showed he had not been drinking heavily. His father, Graham, is convinced his son was killed in an unprovoked assault.

All three men were attacked in the Montechoro area of Albufeira, popular because of its is restaurants, bars and clubs.

About 1.6 million Britons travel to Portugal each year. The Foreign and Commonwealth Office says that the number of violent attacks in Portugal is low but that there is still a need to take care. It has revised its travel guidance to Britons and warned them to remain alert at all times. 

A Polícia Judiciária spokeswoman told me today there was as yet no clear evidence the same gang carried out the three attacks but that investigations were continuing.   


The incidents are causing considerable concern within the Algarve. 

Elidérico Viegas, president of the Algarve's largest hotels' association, blamed the recent rise in violence on the government's failure to properly address the needs of a region whose economy is based on tourism.