Independent:
Even as the final details of the Irish rescue package are still being resolved, investors and economists are asking: "Who's next?"
The answer has been plain for some weeks – Portugal is the nation widely regarded as next most in need of assistance after Greece and Ireland, with Spain and, possibly, Italy following behind. There has been intense fear in Lisbon, Madrid and Brussels about what would happen even if Ireland's problems were not resolved rapidly.
Over the weekend the pressure piled on Lisbon again when the main opposition party queried whether Portugal's official debt figures were accurate. Persistent doubts about the Greek statistics have undermined Athens' attempts to gain credibility and qualify for aid; now the leader of the Portuguese opposition, Pedro Passos Coelho, has told his Social Democratic Party conference that items such as nationalised industries' companies' debts were not included in the overall public debt, which the government puts at 82 per cent of gross domestic product this year – even higher than Ireland.
While Portugal doesn't suffer from the same extreme banking crisis that Ireland does, many economists believe that her fundamentally uncompetitive economy leaves her as exposed as Greece to long-term difficulties while she remains inside the euro zone. They also doubt that she will be able to make her austerity programme stick.
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It is interesting how many of the liberal governments over extended during the boom and have struggle to over extend during the recession. The UK papers have several similar stories, along with some giving belated props to Margaret Thatcher for keeping them out of the Euro currency.
Image via Wikipedia
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