IMF Says Portugal Faces Risk From `Rising Stress` in Europe
Baku, December 22 (AZERTAC). The International Monetary Fund said the European debt crisis is a “serious” risk to Portugal as the nation seeks to meet the targets of its financial aid program and return to bond markets in two years.
“Portugal`s program has remained broadly on track, but rising stress in Europe is a serious risk,” the Washington- based lender said today in a report. “Substantially higher capital requirements across Europe, coupled with cuts in exposure to the periphery, are placing further pressure on banks and the flow of credit. Further negative spillovers could significantly complicate domestic policy making.”
The IMF`s executive board yesterday approved a disbursement of 2.9 billion euros ($3.8 billion) to Portugal after completing the second review of the country`s performance under the aid program.
Prime Minister Pedro Passos Coelho is cutting spending and raising taxes to meet the terms of the 78 billion-euro aid plan from the European Union and IMF. As the country`s borrowing costs surged, Portugal followed Greece and Ireland in April in seeking a bailout and now plans to return to bond markets in 2013.
Other news in this section
