Portugal: Interest rate on aid not yet determined

[May 05, 2011]  LISBON, Portugal (AP) -- Portugal's finance minister says officials have not yet calculated the interest rate on the the country's euro78 billion ($115 billion) bailout nor the loan's maturity.

Finance Minister Fernando Teixeira dos Santos says the three-year financial rescue program foresees an economic contraction of 2 percent this year and next, with growth returning only in 2013.

He says the bailout sum is enough to cover ailing Portugal's funding needs in coming years.

Teixeira dos Santos said Thursday the plan focusses on improving Portugal's frail economic competitiveness as well as slashing expenditure to reduce its heavy debt load.

"This is a good (bailout) program and an opportunity we can't waste," Teixeira dos Santos said.

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THIS IS A BREAKING NEWS UPDATE.
AP's earlier story is below.

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LISBON, Portugal (AP) -- Portugal's three main political parties have given their blessing to new austerity measures in return for a euro78 billion ($115 billion) bailout.

The parties, which together are forecast to collect around 80 percent of the vote in next month's election, say ailing Portugal has no other choice.

Authorities have said the country won't be able to meet debt repayments due in June.

The International Monetary Fund and Portugal's European partners are putting up the money as they did for Greece and Ireland.

The center-right Social Democratic Party and Popular Party gave their consent to the bailout package late Wednesday. The outgoing Socialist government had already accepted it.

[Associated Press]

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