This content is not available in your region

Portugese banks rally after bailout

Portugese banks rally after bailout
Text size Aa Aa

Portugal’s caretaker Prime Minister, Jose Socrates has come under criticism after announcing his intention to seek a bailout of up to 90billion euros from the EU. He is set to make the formal request to Brussels in the next few days though its unclear how quickly a deal can be negotiated.

Despite the public’s anger that he waited so long, there is broad support across Parliament for his action.

“It is important the Portuguese feel that this decision the government has taken can only be understood as a supportive measure for the sake of national security and for the preservation of Portugal’s reputation abroad,” explained opposition leader, Pedro Passos Coelho.

As the details of the loan request hit the streets shares soared while editorials praised the, ‘pressure from the banks’ on the government to seek aid.

So far it has only asked the EU for help though the International Monetary Fund says it stands ready to help.

Lisbon will now have to agree to tough austerity measures. The move has brought mixed reaction.

“He should have done this long ago even before the government had fallen,” said one person while another talked of a move away. “I am already affected because I am one of the many jobless in Portugal. Perhaps it is an opportunity to emigrate.”

Lisbon’s decision, say analysts will help calm markets while neighbouring Spain struggling to crawl out of recession after a property collapse insisted it would not be next in the firing line.