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Portugal’s Government May Collapse Before EU Summit

March 24, 2011

www.benzinga.com

In a report published by Reuters, the Portuguese parliament is expected to reject government austerity measures on Wednesday, which could lead to the collapse of the minority Socialist administration one day before the EU summit.

The country’s Prime Minister, Jose Socrates, has declared that he will resign if the plan is defeated, due to the fact that its rejection would force debt-ridden Portugal to seek a similar international bailout to Greece and Ireland.

If Socrates stands by his word, then he appears to be heading for the exit door as all opposition parties have proposed resolutions calling for the rejection of the measures, which would look to cut the debt by reducing pensions and state spending.

The main opposition is the Social Democrats, and the party has already begun talking about a snap election. When asked if it is likely that the government will step down, Socialist bench leader in parliament Francisco Assis said that, “If all these positions that now seem irreversible are confirmed, then yes.”

“The prime minister does not want to resign, but he cannot govern against his convictions,” Assis said.

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