Addressing the Congress of Economists at the Gulbenkian Foundation in Lisbon today, the Prime Minister Pedro Passos Coelho pointed to the reversal of the current demographic situation, the reduction of structural unemployment and the correction of "profound imbalance" in the country’s social security system as “challenges for the coming years.”
Saying that there have been no concrete solutions to these challenges, Passos Coelho considered that it will be necessary further to reduce primary public expenditure and that this "still requires a good debate."
According to the head of current PSD/CDS-PP government, we also needed solve problems in the country’s banking and real estate sectors to avoid "economic disaster as we move forward," but in his view "these has been solved."
Referring to the Portuguese age pyramid, Passos Coelho said that "the country will not be sustainable if current demographics remain" and that "more consistent policies are needed to reverse the current situation, and to increase the proportion of young people.”
Portugal has "a very high structural unemployment problem, it has been above 10% for several years," said the PM, adding that, regarding social security expenditure, this "is a very important challenge" and that "the sooner and more widely this can be answered, the better for everyone."
At the close of his key-note speech, the prime minister argued that "structural primary expenditure will have to come down further because this is in the Fiscal Compact and also is required by the taxpayer who pays the bill.”
"It's clear to see that if we fail to reverse this situation, we will not have productive economy; we will have an economic disaster, but I think that there are conditions to making this shift. The problem of banks' portfolios was too great to be able to be solved in one go, but I think that has to be solved at a pace that is consistent with the preservation of financial stability, and without the use of more external financing," added the PM, failing to acknowledge that after years in government, the poor performance in the sectors he outlined will be used to judge his government in the coming general election.
