• Inside Labour

    Brexit should send warning signals to worker organisations everywhere, says Terry Bell.

  • Racial redress

    The next adult generation is at risk of being polarised on the basis of skin colour, says Solly Moeng.

  • To do list

    Keep separate lists to ensure your to-dos don't get cluttered and gain stress-free productivity, Ian Mann.

All data is delayed
See More

El-Erian: Portugal may be the next Greece

Mar 19 2012 12:38
Frankfurt - Bond fund giant Pimco's chief executive said he expected Portugal to be the next eurozone country to falter, according to an interview in German weekly Der Spiegel.

Asked whether he expected Portugal to have become the next Greece by the end of this year, Mohamed El-Erian told the magazine: "Yes, unfortunately that will be the case".

Portugal's economy is forecast to contract 3.3% this year - its deepest slump since the 1970s - as the government implements austerity measures under a €78bn (£65bn) bailout from the European Union and International Monetary Fund (IMF).

El-Erian, also co-chief investment officer of Pimco, said he expected Portugal's first bailout package will be insufficient, prompting it to ask the EU and IMF for more money.

"Then there will be a big debate about how to split the burden between the EU, creditors, the IMF and the European Central Bank. And then financial markets will become nervous because they are worried about private sector participation," he told the magazine in an interview published on Sunday.

El-Erian said this year would show whether the eurozone will fall apart or become a smaller but stronger entity, with the first option being "less likely but definitely not to be ruled out".

He expected the eurozone could emerge from its crisis very quickly if its members "finally took the initiative".

"There is a lot of money waiting on the sidelines to see what happens. A lot of money," he said, adding executives would start investing again as soon as there was clarity on how the situation in the eurozone will develop.

Pimco, with $1.36 trillion assets under management, is a unit of German group Allianz that is largely autonomous.

Asked about talk that Pimco could be spun off from its parent, El-Erian said: "That is total nonsense."
eurozone debt crisis  |  greece  |  portugal


Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

We're talking about:


Debt is one of the biggest financial issues facing South Africans today. Find out how you can avoid and manage your debt with Fin24 and Debt Rescue.

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Labour’s call for a cap on salary of high earners is?

Previous results · Suggest a vote