From Crisis to Growth, Lima Touts Economy as Portugal Vote Looms

Antonio Pires de Lima
Economy Minister Antonio Pires de Lima. Photographer: Scott Eells/Bloomberg

As Portugal’s election campaign heats up, Economy Minister Antonio Pires de Lima isn’t aiming his shots at foes like the Socialists, the main opposition party that leads the ruling coalition in polls ahead of the Oct. 4 vote.

Instead, he’s confident the latest batch of economic indicators will ultimately convince most Portuguese to vote for those who steered the country away from bankruptcy and back to growth.

“I don’t think the Portuguese will vote according to promises or wish lists,” Pires de Lima said in an interview at the Economy Ministry in Lisbon on Friday. “This government has proven it put the country on the right track and in the end there will be some recognition by the Portuguese people of that fact.”

More than a year after Portugal completed an emergency aid program that led to an increase in taxes, record joblessness and a three-year recession, the economy is growing again, unemployment is falling and the government is selling debt on the market. On Friday, it announced gross domestic product expanded 0.4 percent in the three months through June for a fifth consecutive quarter of growth.

Lima’s CDS party joined Prime Minister Pedro Passos Coelho’s Social Democratic Party in a coalition after the June 2011 elections, replacing a Socialist minority administration that had requested the nation’s bailout two months earlier.

‘Completely Different’

His government has held the Socialists accountable for driving Portugal to the brink of bankruptcy to underscore the dangers of electing them again. By early 2012, 10-year government bond yields had reached almost 18 percent. They’re now about 2.4 percent, close to a record low.

When Portugal requested a bailout, “we were really waiting for the worst,” said Lima. “Now the feeling is completely different and the economy is growing, employment is recovering and the general feeling in Portuguese society is one of hope, and I think that might help in the result of the next election.”

Lima, 53, said he wouldn’t be surprised if growth this year is more than the government forecast of 1.6 percent. Portugal’s economy expanded 0.9 percent in 2014 following three years of contraction, according to the Bank of Portugal. The jobless rate fell to 11.9 percent in the second quarter, the lowest since 2010.

Political Uncertainty

While there are no anti-austerity parties like Podemos in Spain or Greece’s Syriza gaining in the polls, Portugal faces the prospect that neither the government coalition nor the Socialists will win the election outright. That could lead to a minority administration and the possibility of fresh elections.

The Socialists had 36.3 percent of the vote against 34.8 percent for the coalition in a survey of voters’ intentions published by Expresso newspaper on Aug. 7, a narrower margin than in July.

“The lack of a majority will be clearly a cause of instability in the country,” Lima said. “So I think it’s quite desirable that as a result of the next election we will have a stable solution.”

As for Lima’s plans for the future, he replied: “I have no idea.”

“I do not intend to become a professional politician and I feel that my mission after this mandate was really achieved in terms of my contribution to this government.”

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