Portugal and its position.

[FrancMor13]

Good Evening, here in Portugal, the things are not going well... Our financial\economic problem is getting bigger and bigger... and the current government is lying on us every day, saying that "We are a strong nation, we will resist this!" They say that because they have "deep pockets" and they forget about the "official" 16% of unemployment , but the real statistics are on circa 25% of unemployed people.
I think that the best solution is to make this country more of an agrarian country, we have unworked zones all over this little nation, and try to devellop a better relationship between the ruler and the people.
Do you have also ideas of how to resolve this crisis?

[fkizz]

consider better the advantages and disadvantages of leaving the euro - risky option, but worth considering. can be either sucess or failure depending on how its negociated.

[hellheaven1987]

consider better the advantages and disadvantages of leaving the euro - risky option, but worth considering. can be either sucess or failure depending on how its negociated.

The issue of Portugal is its industry is not competitive internationally, so regardless withdrawing from Euro or not that problem still would not solve.

And no, no matter how Portugal develop agriculture there is no way it can beat agricultural giants such as Merica, France or Australia.

[fkizz]

The issue of Portugal is its industry is not competitive internationally, so regardless withdrawing from Euro or not that problem still would not solve.

The problem of portugal was the gradual de-industrialization it suffered since joining EU, under protectionism for example we still had a lot of naval related industry, but got some funds in exchange for leaving protecionism, it got seriously worse when joining the euro, we haven't had sustained economic growth for 14 years, and we joined the euro 14 years ago.

Coincidence?

Not to mention due to several factors including our own low self esteem as a nation and the not so innocent EU, we pratically have no fishing fleet, and some landlocked countries have more fishing industry than we do, despite us being a country facing the sea.

Amongst many other things.. but we could easily gain some of the competitively back with a lower exchange rate. Problem is, many people still sort of hope for a another trench of EU funds like in 90s and 80s.. but thankfully (in a sort of paradoxal way) for us in Germany does not like to give free lunches, which might give us the margin we need to leave this failed currency.


You have no idea how lucky you are for Denmark not having joined Euro.

Withdrawal symptoms may bankrupt you.

True, leaving recklessly the euro would be suicidal. However when we had bail out our debt level was at 94% of GDP, after 3 years of heavy austerity and "reforms".. our debt is at 130% of GDP. And financial times, newspapers, etc, call this a huge sucess. Our debt increased, economy worsened, and they praise us on the success.

I can understand that since we followed TROIKA reforms by the book them calling us failure would be calling failure themselves, but this almost cynicism.

Prolly related to spreading disinfo before european elections on 22 may, to avoid eurosceptic votes by messing with perceptions.

[Ric_TW]

The problem of portugal was the gradual de-industrialization it suffered since joining EU, under protectionism for example we still had a lot of naval related industry, but got some funds in exchange for leaving protecionism, it got seriously worse when joining the euro, we haven't had sustained economic growth for 14 years, and we joined the euro 14 years ago.

Yes, this is part of the problem. And the de-industrialization continued, also due to another factor: in the last decade, many factories relocated to other countries in East Europe and Asia, where they pay less and make a higher profit. Now we have to buy what we once produced here, and in exchange our unemployment increased, because those factories are gone.

I think trying to develop agriculture would help, but would not be sufficient. I mean, a country which relies mainly in agriculture and leaves its industry behind is a poor country. So we should have to create conditions to regain the quantity of factories we lost.

And we have also a demographic problem. People live longer, which is good, but now retired people represent a much more considerable percentage of our population than 20 or 30 years ago. This increases the state's expenses not only with pensions, but also with health, because old people are much more prone to become sick.

Although some countries, including our own are having more difficulties, this is actually a problem all Western Europe, North America and Japan have. You see demonstrations everywhere against higher taxes, loss of rights, etc, and this is happening because those economies are becoming weaker, while the states' expenses are growing more and more.

I think all those countries should, among other things, try to make some kind of agreement related to restrictions to products manufactured in countries which pay much less to employees, which makes their products much cheaper, and also to change some rules, making it harder for the factories to relocate. If this can be done or not, or if so, how to do this, I don't know, because I'm no specialist in economics. But as the situation is now, I believe things can only worsen to all those countries.

[Condottiere 40K]

Withdrawal symptoms may bankrupt you.

[Dante Von Hespburg]

Moved to Political Academy

[conon394]

for example we still had a lot of naval related industry

I not sure I get your point here but if it is what I think I believe you are pointing at the wrong target. Commercial fishing has collapsed in a lot of places for a number of reasons. Foremost of course is the collapse of Many long standing fisheries (Google Atlantic cod). Thus of course not only have fisheries been closed but of course everyone is a lot more touchy about poaching or sharing rights to fish. Second in many cases bigger more sophisticated boats have supplanted smaller local boats to find those fish still abundance. As such you would expect a drop in support industry, unless it was able to adjust and serve say the EU region as a whole - and that kind of thing can hard. I mean to keep that kind of industry requires a cost. Take computer recycling - every year vast amounts of computers in the US are replaced and as obsolescence are sent of to be recycled, but the rub it is a messy expensive process and one that to meet environmental regulations (in the US or EU etc) requires (red cost) a lot effort. So most companies and individuals have a choice they can pay more - sometimes a lot more to have done in the US or just toss them on a boat and ship them to India or Africa for a lot less. Is that de-industrialization - sure but does a small business owner or CPA looking at maximizing the quarterly profit care?

I don't disagree that the Germans are pushing for extreme self defeating austerity in too short a time frame (and perhaps not at for some countries at the moment). In addition obviously the EU is still dealing with the issue of and unified monetary policy that remains conservative but a disjuncture to fiscal policy. But the structural issues in the EU were always there to be seen, what's intresting is the lack of will by not Germany states to roll back polices that server German interests first and foremost.

[FrancMor13]

But, the agriculture is not for exporting, is for living here in Portugal! We would import less. The industry is not develloped because we do not have any zone to construct factories and research centers. It would be suicide to exit the Euro, because no euro = no food. This a labyrinth without exit... Portugal doesn't have any "talent" except tourism, to escape this. We received financial help for develloping the countrty. More than a half are in the pockets of our corrupt government. The other half is bad invested. And after this, some foreign nations, such as China and Angola are "buying" everything.
Do you know that the biggest walled fertile lands of Europe are here in Portugal? But the "princess" of Angola bought that...
That is quite bad if you want to keep your independance...
By the other hand, Germany, apparently wants us to starve to death...
Why this always happens to us and to the greeks?

[Knight of Heaven]

But the structural issues in the EU were always there to be seen, what's intresting is the lack of will by not Germany states to roll back polices that server German interests first and foremost.

Well thats because this countries indeed lost sovereignty, partialy at least, Specialy in the case of Portugal, and i dare say Greece ( but i will speak on the case i know best.)
The last, recent Portuguese Troika evaluation, was very transparent on this, Despite the goverment "willingness" to negotiate, the FMI and Troika wont had it any other way. We are to expect more blind cuts and more taxes, and more heavy burden on taxes. This isnt realy Austerity, what they have been doing since day one, is milking it where they can. There is a lack of a national plan long term, and clear reform.
We are a country that produces alot of qualified people, specialy on Medicine, above EU average we can say we produce an abundance of Doctors, yet, our system already has been sufering from lack of doctors, that isnt even funny. For some time there has been people actualy dieing at the emergency wards because of this deficiency in the system. A real lack of doctors and means, its unbelivable.
I never tought that we will end up at this point.
Now what im saying is a complain, and direct result of this austerity, the lack of means because of it, is already costing lives in a quite direct way.

Honestly i have always been a beliver on the european project, but there is not denying that there is plenty of wrong with this EU at the moment, and euro skepticism never has been so high, and growing. Yet im also Skeptical, of the "miracle" beneficts, of us leaving the comon currency. I think it would solve a problem, but im not convinced it would be "the" problem. Not to mention the consequences of it.
Idealy, what would be nice, was general change of policy in Europe. But i honestly i dont know what is more hopeless.
Im also much more cautious to EU position in the world afairs then i was. The whole Ukraine situation isnt helping matters. As well the already lack of democratic values, in favor of current "belived"technocratic principles, in EU proceedings. Jürgen Habermas, notes that much, in their latest articles.
The scenario and future promises seems rather bleak at the moment.
Mostly because europe is growing each day more unequal. And that does not bode well for its health.

And no, no matter how Portugal develop agriculture there is no way it can beat agricultural giants such as Merica, France or Australia.

Well it doesnt realy need to. Only thing it needs is being less dependent on EU imports for basic needs. And dont tell me is impossible, because we did it as energy is concerned. Not enough to be 100% independent, but we improved alot in the last decade. The only Aquilles in this area is of course fossil energy, but substancial progress has been made on renouvable energies, Portugal is amoung the world leaders on Eolic energy right now.

While im not saying is ideal, i say alot of progress has been made, its not like we arent capable imo. There is alot of problems in the empresarial sector traditionaly and on economic growth, such alot of bureaucracy, and high cost expenses mainly. Taxes are a part of it, but they arent even the biger part imo.

[FrancMor13]

It's fantastic to see someone that has the same opinion as I!

[FrancMor13]

I think we should make our nations as independent as we can, because, we are not slaves of Germany and China! We fought for our freedom, just to lose it, so quickly as a blink of eyes? NO! If we want to stay as a sovereign state, we must invest on our strong points and eliminate our weak points.
And By The Word: Don't you think that is ridiculous to see our politicians having a fantastic life, when people, I meet loads of them, don't have money to eat every day? No one can imput order here?

[fkizz]

Ideialy, what would be nice, was general change of policy in Europe.

OCDE predicts we need austerity until 2030 to have a debt ratio of 60%

http://www.tsf.pt/PaginaInicial/Econ...ent_id=3846454

which is quite optimistic given austerity has only accelarated debt ratio so far.

[Ciciro]

Portugal should kiss and make up with Spain, and get mucho deneros from Catalonia.

[Denny Crane!]

I love this idea that "portugal couldn't compete" (replace portugal with UK or any other country) as though economics and politics is a zero sum game where you are as big or bigger or you die! Which plainly isn't the case.

So a question for the Portuguese in this thread, is anyone actually discussing leaving the euro seriously?

[FrancMor13]

We just don't have the power and the engine of the superpowers... We simply cannot leave the euro, because is too late! Before we agreed with the single coin (Euro-Zone) we had a good rate with our money. But, it undervalorize our products. An example is a simple cofee. The cofee costed around 50 escudos (our ancient coin) that it's around 25 cents. They put 50 cents... (Note: 200 escudos = 1 euro). A candy costed what we could now answer of 1\10 cents. Now it costs 5...
We can't leave because all the funds to devellopment and for "living" are in Europe. We would starve to death if we leave...

[Ludicus]

is anyone actually discussing leaving the euro seriously?

Yep. João Ferreira do Amaral, Professor of Economics and Economic Policy at ISEG,



"Why we should leave the euro"
Key points,

Sooner or later, Portugal will be faced with an exit from the euro. It is inevitable...This exit should happen when the eurozone is stabilised, in two or three years and should take place in an orderly fashion..The country should return to its old currency, the escudo, in coordination with European governments, Brussels and the European Central Bank, which should continue to finance Portuguese banks initially.
There is no other way for us to be competitive again...I'm not against the euro as such, but the currency is too strong for our Portuguese industry
...The country needs investment. The best way to encourage investors is to devalue the currency...the inflationary dangers that would likely arise from such a move would not be all bad...Inflation does not necessarily mean a drop in living standards ... it would be compensated by growth.

https://www.google.pt/url?sa=t&rct=j...Qh9tDEWl020Irg

[fkizz]

To add João Ferreira do Amaral also wrote a new book, "In defense of nationa soveringnity"; which I haven't had the chance to read it yet.

Still I feel proud to belong to ISEG such as he does. But it isn't the general consensus of ISEG; we have all kind of teachers from left to right wing, of all opinions.

[Ludicus]

Still I feel proud to belong to ISEG such as he does. But it isn't the general consensus of ISEG

Indeed. Prof.Francisco Louçã, (one of the left Bloc´s founding members) disagrees. "Portugal’s leaving the Eurozone would have disastrous consequences for the mass of the population and would in no way solve the country’s problems" (Louçã 2012)

Have you seen this Francisco Louçã interview? (yesterday - video-it´s about the apparent inevitability of Portuguese debt restructuring)
http://www.rtp.pt/antena1/?t=Entrevi...16&headline=13

[Knight of Heaven]

So a question for the Portuguese in this thread, is anyone actually discussing leaving the euro seriously?

In the level of the political power no, not realy, even if some parties seem to hang on that notion, even if not openely admit it. There is however a clear consensus from left to right to negotiate again the Portuguese debt. This consensus doesnt encompass those that are currently in the goverment.
However there is alot of debates and discussion on the paralel side, in the society, mainly academic, and of political opinion about leaving the euro.
I hear there has been some independent political forces with that ideia in mind, on the upcoming european elections.
I would say it is discussed alot, as well the crisis. But cant say any major political party has proposed such notion yet.

"Portugal’s leaving the Eurozone would have disastrous consequences for the mass of the population and would in no way solve the country’s problems"

I tend to agree with him on this.

Yep. João Ferreira do Amaral, Professor of Economics and Economic Policy at ISEG,

The major problem with his concept, its that is quite dependable as well on the outside and of the EU to soften the transiction.
That cant be acomplished on our own, He himself admit that, it would require a consensus and help of alot of European countries to do that. In other words, the descontruction of the comon currency would need to be allmost unanimous within the EU, meaning it wouldnt happen only in Portugal. In order to see us doing that.
It is a scenario, i just dont see it happen anytime soon. I think faster we destroy ourselfs, and empoverish even more to levels unseen after 1974, then the whole of EU agrees with us leaving the euro on our own.
Meh i have litle faith in this or the good will of EU solidarity. ( political wise)