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On air at 1100GMT: Should the rest of Europe bail out Portugal?

Chloe Tilley Chloe Tilley | 10:22 UK time, Thursday, 7 April 2011

 

So Portugal is the latest eurozone country to ask for a bail out. The Country's caretaker Prime Minister Jose Socrates followed Greece and the Irish Republic in seeking financial help. Jose Socrates had put off a bail-out request as long as he could, having stepped down as prime minister after failing to pass austerity measures.

 



"I always said asking for foreign aid would be the final way to go but we have reached the moment. Above all, it's in the national interest."

EU finance ministers will discuss the request when they meet in Budapest later.

It's a complicated picture. It's not clear how much aid Portugal will ask for. Negotiations will now be under way and the BBC's business editor Robert Peston said rescue loans could amount to as much as 80bn euros ($115bn; £70bn).


Yesterday the government raised about 1bn euros after tapping the financial markets in order to repay loans, but will have to pay a higher interest rate to lenders.

Portugal's problems have been different from those of the other countries that have needed bailing out.

Low economic growth and high wages have meant that the country has struggled to raise enough money through taxation to pay for government spending.

Spain insists it won't spread to them.

Ritchie_I tweets

Why should we have to increase our own borrowing to help bail Portugal out. Sort ur own mess out eurozone

 

richdavidson tweets

You're only getting half the story. We bail out Portugal so we don't expose how weak uk banks are. THAT is the swindle here

 

We'll be joined by people in Portugal, Greece and Ireland live on air at 1100GMT. The BBC's Stephen Evans, former Business presenter, now Berlin Correspondent will also be here to answer your questions.


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