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Portugal launches fresh round of austerity measures

 
 
 
 
 
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People protest against government austerity policies at Lisbon’s main square, Praca do Comercio, March 2, 2013.

Portugal has announced a fresh round of spending cuts in order to obtain the approval of international lenders and secure additional funds for the debt-ridden country.

The Portuguese government said on Thursday that it plans 800 million euros of spending cuts this year on public sector staff, goods and services, which is worth 0.5 percent of the country’s annual gross domestic product.

The new measures are designed to meet a budget shortfall of 1.3 billion euros, after the Constitutional Court ruled that four out of nine austerity cuts stipulated in the coming budget were “unconstitutional.”

Meanwhile, the Portuguese people staged a march in the country’s capital on Tuesday to protest against the austerity measures imposed by the government.

On April 14, the European Commission warned Portugal that it should implement its austerity measures as part of a European bailout deal or risk the drawback of future aid.

The European Union (EU), the European Central Bank (ECB), and the International Monetary Fund (IMF) granted Lisbon an emergency loan worth 78 billion euros (102 billion dollars) after the country’s borrowing costs soared to unsustainable levels.

Portugal is seeking to cut four billion euros in public spending by 2015 in an attempt to recover its economy.

The country is grappling with its worst recession since the 1970s, and is bracing for a record 18.2-percent unemployment rate in 2013, up from 16.9 percent in 2012.

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