Friday, July 15, 2011

1000s protest Lisbon's austerity plans

Thousands of people in Lisbon have held demonstrations in protest at the Portuguese government's austerity measures. (File photo)

Source: Press TV

Thousands of people have taken to the streets in the Portuguese capital to protest austerity measures adopted by Prime Minister Pedro Passos Coelho's government.

During the demonstration, which was organized by Portugal's largest umbrella union CGTP, the protesters marched toward the parliament, chanting slogans against lack of jobs and what they described as 'robbery of salaries.'

The Portuguese government has moved to slash spending and raise taxes to stabilize public finances after the International Monetary Fund (IMF) and the European Union (EU) provided Lisbon with a rescue package of 78 billion euros ($110 billion) earlier in 2011, AFP reported.

Portugal was forced to seek the bail-out loan from the IMF and EU after the government collapsed in April, causing its borrowing costs to surge dramatically.

Stressing the necessity of tax hikes to meet budget goals, the Lisbon government announced an extraordinary tax to be levied on year-end bonuses on Thursday.

Portugal is the third country, after Greece and Ireland, to succumb to financial troubles in the euro zone debt crisis and seek funding assistance.

Under the country's loan plan, Portugal's new government, which was elected in June, needs to reduce its budget deficit from over nine percent of its GDP in 2010 to 5.9 percent this year.

Recently, the credit rating agency Moody's Investors Service downgraded Portugal's sovereign debt rating to "junk bonds" status, voicing concerns that the debt-ridden country would not afford to reduce its deficit without receiving another bailout.

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