quarta-feira, 4 de outubro de 2017


In the United States, in 2008, suffer from mortgages which originated the financial crisis. That has led to a debt crisis in the European Union too. That crisis first began in Greece, in the following years, and European countries around Greece started to be affected by this crisis. 
Resulting from the mortgage crisis in the United States, since 2009 exchange rates, foreign trade and interest rates highly effected to EU countries. Examining the results of countries like Greece, Ireland, Portugal, Spain and Italy, researchers have reached to the conclusion that structural problems in the national economies were the main cause of the crisis in Europe.
It can be said that in the fight against the debt crisis, after the restrictive fiscal policy imposed by the EU member countries, the budget deficit and the current account deficit were partially successful. However, there has been no significant improvement in the debt burden and unemployment rates of the countries. In many countries, public debt also tends to increase continuously. Unemployment rates are at very high levels as well. 
The mortgage crisis that started in the US rapidly spread to European Union countries, which are in close commercial and financial relations with the US. Greece was the first country in the EU to suffer financial crunch in end of 2009. Spain, Ireland, Portugal, and Italy, which had difficulty in turning public and private debts after Greece, also experienced financial crises.
Portugal is also a country that has suffered from the debt crisis in Europe. As soon as the Portuguese government realized that it would not be able to fulfil its obligation of borrow money in the international market in the near future, it was submitted to an emergency financial aid cemetery from international organizations, in 2011.
Portugal, which has joined the EU in 1986, has benefited considerably from the policies of the Union in terms of trade-offs and protectionist tariffs (Countriesquest, 2015). Again, Portugal has benefited from the funds that the Union has invested in infrastructure investments since joining the EU, and has encouraged foreign trade by using cheap labour power. In Portugal, which later joined the European Monetary Union, interest rates and inflation rates have fallen rapidly (Euro Challenge, 2014a: 1).
The Origin and biggest Reason of the Debt Crisis in Portugal is the high debt burden resulting from the money borrowed by the banks from the Eurozone in the 2000s, and the resulting fragile financial structure.
During the monetary union, the Portuguese banks borrowed significant amounts of money with relatively low-interest countries, such as Germany and France. With the loans financed by the Portuguese banks, housing investments and institutional investments have increased, disposable income and internal demand have been raised, leading to consumption spending reaching unsustainable levels (O'Flynn, 2003). In this way, the budget deficit and public debt level of the country increased. This has played an important role in the debt crisis.
According to the agreement between the Portuguese government and the EU and the IMF, a fund of 78 billion euros was transferred to Portugal in 2011-2014 to support the stabilization program to be implemented. In this respect, it is targeted that the ratio of budget deficits to GDP would be gradually reduced to below 3% within three years.
In the fight against the debt crisis, all insurance benefits were frozen in Portugal, retirement tax allowances reduced, unemployment benefits cut, VAT increased from %20 to %23, income tax rate increased, education budget, public sector payments, and health care interrupted (Leahy et al., 2014: 50-52). Finally, the capital of banks that were in a difficult position to make their payments have been increased.
With the stabilization measures taken, the economic stagnation in Portugal since 2011 has been lifted by 2014. Interest rates in the country have begun to fall and by 2014, the economy has started to grow positively (Cop, 2013). The financial reform package implemented in Portugal until 2014 has had positive results. Financial imbalances have diminished, foreign competition has increased, and real production has risen (Euro Challenge, 2014).

Kaan Öztürk

[artigo de opinião produzido no âmbito da unidade curricular “Economia Portuguesa e Europeia” do 3º ano do curso de Economia (1º ciclo) da EEG/UMinho]

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