Portugal Draft MoU

Via FT Alphaville, here‘s a draft copy of Portugal’s “Memorandum of Understanding on Specific Economic Policy Conditionality.”

7 replies on “Portugal Draft MoU”

Thanks for the ‘DRAFT’ Karl

‘Central, regional and local administration
3.38. Reduce management positions and administrative units by at least 15% in the central administration. [Q4-2011]
3.39. In view of improving the efficiency of the central administration and rationalising the use of resources, implement a second phase of the public administration restructuring programme (PRACE 2007). [Q4-2011]
3.40. In view of improving the efficiency of local administration and rationalising the use of resources, the Government will submit to Parliament a draft law by Q4-2011 so that each municipality will have to present its plan to attain the target of reducing their management positions and administrative units by at least 15% by the end of 2012. [Q2-2012] In what concerns regions, the Government will promote the initiatives needed [Q4-2011] so that each region will present its plan to attain the same target.

Al Jazerra reporting Portuguese PM Socrates saying there will be no job cuts or reduction in wages.

Is that great negotiation or politicians B*******ing again? 🙂

The MOU presented here contains 220 conditions (count them!) during the programme period. But this is an EU MOU as opposed to an IMF MOU.

An IMF MOU that needed 220 conditions to reach its target would be regarded as amateur hour. (If you cannot make it simple, don’t do it). But maybe that is where we are now–the EU amateurs are in control.

Let’s wait to see the IMF MOU.

@ Gary

excellent article in the Indo today btw. Karlos – pull the finger out and start up a thread on Gary’s suggestion that Herr Weber resigned in protest at the treatment of Ireland!!

@Bond. Eoin Bond

Axel gave his ‘dissenting opinion’ explicitly in a speech in Berlin around the time of the minor €24 more billion or so for the … er … Irish Banks …. of course, he was a dissenter on direction of ECB policy prior to this … and since …. his successor, and former student, if of similar opinion on need to burden-share cost of crisis with the ‘private’ financial system …


Further, as not a Dissenter can presently be found on this island … sad to relate that ‘the sovereign republic’ is no more …. !


Newz from Der Spiegel …

‘Portugal has agreed to accept the austerity measures attached to the 78 billion euro bailout package designed to pull the country back from the brink of bankruptcy. But the conditions are far less draconian than those imposed on Greece and Ireland. The European Union has learned its lesson, say German commentators.’

The center-left daily Süddeutsche Zeitung writes:
“Portugal has the luck, dubious though it may be, of being the third euro-zone country, following Greece and Ireland, to receive aid in its time of emergency. The case of Greece in particular has demonstrated that shock therapy isn’t especially effective.

Conservative Die Welt writes:
“There are good reasons for bailing out Portugal…. But there is a fundamental problem in the European Union. Despite months of discussions, EU political leaders have still not reached a consensus as to the path out of the crisis…. Indeed, top politicians still haven’t even been able to answer the vital question as to whether investors should bear the risks of their ill-advised investments in bonds from Greece and Portugal or whether banks should be granted a free lunch.”
“The fact that there is no clear position on the issue is shocking. Many would like to see the banks get away scot-free. And that may be advantageous when it comes to the stability of the financial system. But that would mean that euro-zone taxpayers would once again have to assume the costs of a crisis which began with bank stockholders making good money. That’s not how the free market economy works. It would be nice if the EU were to realize that fact.”

Frankfurter Allgemeine Zeitung …’ publishes waffle from Professor Sinn!


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