# Portugal crisis

- Canonical URL: https://www.gerhardmerk.de/portugal-crisis
- Post ID: 592311
- Modified: 2023-07-25T21:12:57+00:00
- Language: en

## Definition

At the beginning of 2011, it became clear that Portugal, a member of the Eurosystem, was so heavily indebted that it would hardly be able to regain financial equilibrium on its own. As in the case of Greece and Ireland, an aid package had to be put together; Germany had to provide a guarantee of (initially) EUR 15 billion. - It was not only in Germany that this triggered a fierce dispute about how to proceed with Portugal's aid. Portuguese parliamentarians had rejected as unacceptable a program of their own socialist government that provided for a rigid austerity course with steps such as longer working hours and a wage freeze. The fact that European taxpayers are once again being expected to rehabilitate a country that had obviously lived beyond its means for years has demonstrably led to an increase in dissatisfaction toward Europe in wide circles of the population. The discontent in Germany in particular was intensified because - as in the case of the Greek crisis - the Portuguese public widely blamed the "strong" euro countries, especially Germany and the Netherlands, for their own inability and failure. Even in academic circles, the exit of a member of the Eurosystem, which until then had been regularly and formulaically referred to as "nonsensical" or "out of the question," was now being discussed. - Due to the poor economic situation, an increased brain drain started in Portugal. In 2011 alone, over 150,000 well-educated younger people left Portugal, most of them migrating to Brazil and Angola. This and other circumstances - innovation is nil: of the 52,000 patents granted in Europe in 2009, Portugal accounted for just 24 - make it seem unlikely (remote) that Portugal will get back on its own feet anytime soon. - See bail-out, blame game, ClubMed, currency swing, Ekart, eurobonds, common, European Stability Mechanism, exit, Greece crisis, Ireland crisis, Minhas-Gerais problem, moral hazard, patent issuance, Plan C, policy clamp, policy default, solidarity, financial, stabilization mechanism, European, Stability and Growth Pact, fundamental error, sovereign debt, effects, stabilization mechanism, European, statistics authority, southern front, transfer union, debt-productivity linkage, treaty compliance. - Cf. Deutsche Bundesbank Monthly Report of April 2011, pp. 53 et seq. (measures to avoid further sovereign debt crises), ECB Monthly Report of March 2012, pp. 109 et seq. (on sovereign debt in Portugal; many overviews; various projections), Deutsche Bundesbank Monthly Report of November 2014, pp. 23 et seq. (labor market in Portugal since 2008; overviews). Attention: The financial encyclopedia is protected by copyright and may only be used for private purposes without express consent! University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec. Professor Dr. Eckehard Krah, Dipl.rer.pol. E-mail address: info@ekrah.com https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk https://www.jung-stilling-gesellschaft.de/merk/ https://www.gerhardmerk.de/

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