Portugal's PM quits amid debt crisis
Lisbon - Portugal's prime minister has quit after opposition parties
overwhelmingly rejected his last-ditch round of austerity measures aimed at
preventing the eurozone's weakest economy from plunging into chaos. The move
turned the debt-plagued nation into the prime candidate for the continent's
next bailout package.
All opposition parties united to defeat Prime Minister Jose Socrates'
proposals in a parliamentary vote, saying the belt-tightening went too far on
the eve of a summit of European leaders.
But their decision means that Portugal is much more likely to be forced to
seek a bailout like those accepted by Greece and Ireland last year, and puts
Spain squarely into the crosshairs of nervous investors concerned about which
European nation might be next.
Socrates followed through on Wednesday on a pledge that he would resign if
the measures were not approved, saying the opposition parties "took away
the government's ability to continue running the country".
"As a consequence, I have tendered my resignation," Socrates said
in an announcement carried live on television.
In keeping with Portugal's constitution, Socrates formally submitted his
resignation to Portugal's president, a ceremonial figurehead who has no
executive powers. The prime minister's resignation ended the centre-left
Socialist government's six-year period in power.
Socrates' latest austerity package was its fourth set of measures introduced
over 11 months as Portugal scrambled to avoid the embarrassment and financial
consequences of asking for outside help to prop up its shaky economy. The
nation has already introduced tax hikes and pay cuts that have angered trade
unions and prompted a wave of successive street demonstrations and strikes.