11/21/10

"Portugal opposition says deficit underestimated"

"Portugal's budget deficit and public debt are higher than those reported by the government...the leader the main opposition party said on Saturday.

Pedro Passos Coelho told a meeting of his Social Democratic Party items like state-run companies' debts were not included in the overall public debt, which the government puts at 82 percent of gross domestic product this year.

He said that the "true" total public debt stood as high as 112 percent of GDP, while the budget deficit should be at 9.5 percent of GDP, far above the minority Socialist government's target of 7.3 percent for the end of the year.

"The state has for many years been removing from the budget a series of activities, which has made a large part of our numbers fictitious," he said in televised remarks.

Government officials were not immediately available for comment. They have previously denied similar allegations by smaller opposition parties, saying that the statistical and budget data were regularly monitored by Brussels...

Investors see Portugal as the next weak link in the euro zone after Ireland, and as another potential candidate for a Greek-style bailout.

Portugal aims to cut its budget deficit to 4.6 percent of gross domestic product next year and has budgeted painful spending cuts and tax increases..."

Andrei Khalip

No comments: