The Portuguese authorities just presented a number of significant new commitments which witness their engagement to ensure fiscal sustainability, strengthen the financial system and raise the growth potential and flexibility of the Portuguese economy.
I welcome and support this package of far-reaching and concrete measures. It is an important strengthening of the Portuguese macro-economic policies.
The additional immediate fiscal consolidation measures amount to 0.8% of GDP in 2011. The announced measures for 2012 and 2013, amount respectively to 2.5% and 1.2% of GDP. This should be sufficient to reach the ambitious deficit targets of 4.6% of GDP in 2011 and 3% in 2012 and 2% in 2013.
We also welcome the commitment to far-reaching structural reforms, notably regarding further labour market reforms and the financial sector, which will foster economic growth and correcting other imbalances.
The announced package will help Portugal regain control over debt dynamics and put an end to uncertainties. We will continue to closely monitor the situation in the context of enhanced surveillance.
The commitments of the Portuguese government clear an important building-block of the needed comprehensive response to the sovereign debt crisis, and call for progress concerning the other blocks, notably linked to the reinforcement and increased flexibility of the financial backstops.