Business | Economy
Germany says it is willing to revise Portugal bailout terms
Decision first has to be made on Greece, Schaeuble says
- Bloomberg
- Published: 00:00 February 11, 2012
- €78b: value of Portugal's bailout last year
- 3%: forecast for contraction in economy this year
Lisbon: Germany may be willing to study revising the terms of Portugal's bailout, Finance Minister Wolfgang Schaeuble told his Portuguese counterpart in Brussels in a conversation picked up by Portuguese television.
Germany will "be ready" for an adjustment of the Portuguese programme if needed, Schaeuble told Finance Minister Vitor Gaspar at a meeting of European officials on Thursday. He said it was key that a decision first be made on Greece.
"That's much appreciated," Gaspar said in a videoclip posted on the website of television station TVI.
Portugal got a €78 billion (Dh380 billion) bailout from the European Union and the International Monetary Fund last year after a rising budget deficit and public debt drove up borrowing costs. Spending cuts and tax increases to improve the nation's fin-ances have contributed to a recession, with the EU in November forecasting a three per cent contraction this year, worse than Greece's 2.8 per cent.
Schaeuble told Gaspar, who worked for six years at the Frankfurt-based European Central Bank, that the German government faces scepticism at home from the public and members of parliament who "don't believe our decisions are serious."
Portugal isn't seeking more flexibility for its programme, Gaspar told reporters in Brussels later in comments broadcast by television channel SIC Noticias.
Adjustment programme
"We won't ask for more time or for more money, we will meet our adjustment programme," he said.
European finance ministers on Thursday held back a new rescue package for Greece. The ECB should participate in efforts to reduce Greece's debt, Luxembourg's Jean-Claude Juncker, who leads the group of euro-area finance ministers, said in Brussels yesterday.
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