The EU will assist Portugal with 78.000M€

I have been always in touch with the Portugal/ EU economic situation since is the country/continent where I am living and working at. I have been here already 1.6 years and it has been a great experience for me, professional and personally speaking.
Today a really good Colombian friend told me that yesterday was approved an aid to Portugal from the EU with 78000M€ (110,000 million dollars), it is the third country in the euro zone that has been rescue from an international bailout in a year, after Greece and Ireland.

I thought after heard so many disagreements and complaints against the government around the city that maybe it was a overreaction. Even thought I knew the situation was not good, I didn’t think they would need an extra help that fast.

And the help came with a lot of money on it, 78.000 million euros which are coming from Europeans countries (26.000 M€ available in the comunatary budget and 26.000 available for the member states) and 26.000 M€ coming from the international loan program. The interest they will pay for this loan haven’t been decided yet, but it would be between 4,25% y el 5,25%.



The payment was decided in exchange for concrete steps to cut the deficit from 9.1% Gross Domestic Product(GDP) to 3% in this 3 years that supposedly last the loan program.

Now the Portuguese Government will have to carry out privatization and reform the health system and public administration to reduce its current deficit of Gross Domestic Product (GDP) to 3% allowed by Brussels 2013, all this labors will be monitored quarterly by the European Commission.



The overall of this situation in Portugal is good, you can barely feel this economy problems, just with the taxes that lately have been increasing drastically.
Hope this loan will really help the country and the whole EU, For sure if Portugal keep stick to the plan can reach a deficit even below the required.