Portugal plans to order a high salary rules and also cut the state budget to reduce a deficit that continues to swell. Pruning is a government effort to combat the national debt that continues to be a burden. German Chancellor Angela Merkel, warned that the EU will increasingly depressed and threatened if the euro slumped due to ongoing debt crisis.
Euro currency continued to fall until it reaches its lowest point during the last 14 months is 1.2517 to the dollar on Thursday. Global markets seem panicked to the uncertainty in Europe. In addition, investors also feared that with an explosion that occurred in Greek prisons and also an indication kriminalisai by nine banks.
Apart from Greece who has now lowered its credit rating, international attention is now focused on Portugal and Spain, which has also lowered its lending rate. Both countries are feared to have a fate similar to Greece. Portugal Prime Minister Jose Socrates announced it would cut salaries of civil servants and ministers. In addition, he also raised taxes about 1% to 21% currently. As one member European Zone, Portugal should keep the rate below 3 per cent deficit. Meanwhile, from Spain, the government is cutting salaries by 5% and are saving up to 50 billion euro budget.
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