All data is delayed
See More

IMF releases loan to help Portugal

Sep 13 2011 07:46

Washington - The International Monetary Fund said Monday it was immediately releasing about €3.98bn to Portugal, part of a three-year rescue of the eurozone country.

The IMF executive board on Monday completed a review of Portugal's performance under an economic program supported by the €27.27bn emergency loan approved in May, the lender said in a statement.

The IMF loan is part of a rescue package with the European Union amounting to €78bn over three years.

Lisbon has been forced to adopt tough austerity measures in an effort to stabilize the public finances, dampening domestic consumption in the process.

Last week the government announced the economy shrank 0.9% in the second quarter compared to the same period in 2010, while domestic demand dropped at an annualised 5.2%.

The Portuguese government forecasts a 2.2% recession for 2011 and a 1.8% contraction for 2012. It forecasts a return to growth in 2013.

Portugal, the third eurozone country after Greece and Ireland to have received an IMF-EU bailout package, no longer raises long-term debt on the markets as borrowing prices are too high.

Portuguese finance minister Vitor Gaspar said last Tuesday that Portugal would return to the markets by 2013 once the country had passed this "financial emergency".

On August 12, the IMF, the EU and the European Central Bank gave the green light for an €11.5bn second tranche of aid as part of Portugal's debt bailout plan, citing progress in the country's austerity measures.

imf  |  portugal  |  europe debt crisis



Read Fin24’s Comments Policy 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:


With infrastructure spending having been identified as one of the key focus areas of the National Development Plan, tradesmen will continue to play a critical role in growing the South African economy through their skills..

Money Clinic

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

Voting Booth

A 30% a month return on investment is:

Previous results · Suggest a vote