In the midst of turmoil in the Middle East and North Africa and worries over Japan, the euro zone’s debt crisis has not gone away, merely dropped out of the headlines for a bit. However, that could change this week as Portugal plans a vote on government austerity measures and Ireland considers whether to give ground on its corporate tax rate.
Reuters reported that there was sufficient doubt over whether the Portuguese measures would pass that Jose Socrates, the nation’s prime minister, had threatened to quit if it was not approved by the opposition. He has said that failure to pass further cutbacks will put Portugal in the position of having to follow Greece and Ireland into bailout territory.
Pedro Passos Coelho, leader of the PSD (Social Democrats) party, said that initially his group had approved Lisbon’s budget goals as promised to Brussels, but the measures currently under consideration were not adequate and had been prepared in haste. The plan, which was first proposed on March 11, is expected to be put before the parliament on Wednesday.
He told reporters, "We reaffirmed that the measures presented by the government … do not deserve the support or approval of the PSD since they lay out a profoundly unfair path for the Portuguese." He added, "There are no conditions of trust for any talks to be resumed between the PSD and the government."