Against impoverishment and injustice, against the programme of aggression! For jobs, wages, pensions and social rights! These are the slogans that will accompany tens of thousands expected on a march in Lisbon and Oporto today to protest against IMF imposed austerity and privatisation programme.
The demonstrations, called by the CGTP, the country’s largest trade union central, come amid rising speculation that Portugal will follow Greece in defaulting on its debts. The government of Pedro Passos Coelho is at pains to argue it is not another Greek tragedy waiting to happen but he’s short on the evidence for this.
This year’s public deficit is falling short of targets, it was confirmed this week, and previous years figures have been revised upwards to incorporate hidden debts, built up in the islands of Madeira. Furthermore, last Saturday the premier had to admit that the Portuguese economy could contract by 1.8% of gross domestic product in 2011 and a more than anticipated 2.3% next year .
The CGTP is not surprised. Like the Left Bloc and Portuguese Communist Party (PCP), the union has repeatedly warned that austerity measures will undermine growth and the public finances.
Portugal, in line with terms agreed for the €78 billion ‘rescue’ loan from the IMF/EU agreed last May, has already passed a wave of measures including a hike in transport prices, increased taxes on gas and electricity and cutbacks in the public work force. Last month, Portugal unveiled plans for a slimmed-down central administration with the axing of 27% or 1,700 managerial posts from the state administration and 137 public companies of directors’ posts.
On Thursday it gave the formal go-ahead for the sale of its Euros 2.3 billion (£2 billion) stakes in power utility EDP, the country’s largest company and pioneer in wind power, and power grid operator REN, which it wants to complete by the year end. In the running to sweep up are German and French energy multinationals EON and Suez, plus the Chinese Power International and Brazil’s Eletrobras.
In a veritable sale of the century, the Portuguese government has also promised to sell its remaining 7 percent stake in oil company Galp this year, as well as privatise TAP air carrier, the national airport service ANA, postal service CTT, water company Aguas de Portugal and RTP public television.
Meanwhile the country’s flagging banks, which have lost 46% of their stock market value since the beginning of the year, are going cap in hand to foreign investors too, including the Chinese. Portuguese banks have struggled to borrow money after the country’s sovereign debt crisis broke out last year. They are under now pressure from the Bank of Portugal to get their financial houses in order, which means no lending to the real economy.
The European Commission is doing its best to maintain positive mood music on Portugal, asserting that it will not need a second financial rescue package. But it also concedes that this may change depending on the Greek situation. “What happens in Greece will impact all over the place, in Portugal, Germany…”, said an EC spokesman Amadeu Altajaf, this week, noting that “countries under greater pressure will suffer more”. The current foreign aid programme for Portugal is “sufficiently well financed”, he said, but acknowledged the situation was at the mercy of “events beyond Portugal’s control”.
Times are certainly getting desperate, with a historic jobless rate of over 12%, rising poverty and accelerating home repossessions – up 350% since the start of the financial crisis in December 2007.
But the thousands who will turn out today in the streets of the Portuguese capital will be in no mood to surrender to the mad money men and their guardians in the capitals of Europe and the US.
The fact is alternatives do exist.
The CGTP argues, for example, that a proper campaign against fraud, tax evasion and the black economy – worth £30 billion a year – could swiftly deal with the deficit, provide funds for growth and obviate any need to sell off the country’s industry and public services to the highest bidder.
More taxes on the rich in a country where the top 25 families hold more £17.4 billion, or 10% of the country’s wealth, would help too, as could a Robin Hood style tax on speculative stock market movements that have done so much damage to the Portuguese economy.
The provision of decent wages, pensions, and levels of welfare, which stand among the lowest in the EU, would not only be just, but would provide a much needed boost to growth.
Finally, the CGTP and other opponents like Left Bloc and the PCP of the government’s policies argue that the country’s public debt – which grew sharply on the back of multi-billion pound handouts to local banks, reckless lending by foreign banks, and speculators on international markets betting against the country’s financial woes – should be renegotiated.
That’s an alternative many protesting today feel is worth fighting for.