Resisting change

France is not anymore a relevant player in the economic arena in most of the areas. Still, the way they are resisting change in the World, will leave them in a third tier position in 5 years time. In this new world you have to match your compensations with your productivity. Just look at the very positive German example.

http://www.publico.pt/Mundo/policia-recupera-controlo-da-principal-refinaria-de-paris-bloqueada-por-grevistas_1462270

A necessary reform

I totally support the rationalisation of State institutions, in order to generate efficiencies, better cost and improve quality of delivery and service to the Citizens. Especially, in a budget crisis situation, that need seems even of utmost importance. As so, I couldn't but totally endorse Marques Mendes proposal of extinction of several public organism, if dubious utility.

http://www.publico.pt/Política/marques-mendes-apresenta-lista-com-dezenas-de-institutos-publicos-que-podem-ser-extintos_1459975

A central european tax?

The responsible for EU budget avented the possibility of a new tax on European taxpayers - a central one, that would strengthen EU's budget. Two quick thoughts:

- An additional tax on an already burdened economy is not positive. Specially if that economy is lagging in a slow, almost unnoticeable growth;

- Additional funding should come from operational efficiency. EU is an unnefective cost vortex - a good example are the regular plennary sessions in Strasbourg.

Instead of trying to put its budgeting problems over taxpayers shoulders, EU should solve its problems. And promote economical recovery as a way for european strengthning and integration - trying to do it with a tax is just another wrong way.

http://economia.publico.pt/Noticia/ue-alemanha-rejeita-cobranca-de-impostos-a-nivel-europeu_1450603

Second place

News are high this weekend on who is nowadays the second largest economy in World. Comments from a Beijing top official put China in second place, overtaking Japan - the holder of that position for almost 40 years.

One of the comments is that it is an irrelevant statement. Given China's strong growth and Japan's 0% or negative performance, it is only a matter of time - if it happens this year or next, it really doesn't matter a lot.

But the other comment is on the European Union. It could be the second largest in the World (or even the first). It is the conclusion everyone reaches when one starts adding the individual GDP of its countries. But, for being considered an economy as a whole, more economical integration is badly needed. And that integration is (more than for a simple journalistic title) vital to stimulate the economy, growth and the population evolution and well-being.

http://edition.cnn.com/2010/BUSINESS/07/31/china.economy.growth.ft/index.html?hpt=Sbin#fbid=yiFAcP_U9A7

Good news

The positive results of the Portuguese main banks on the EU stress tests are very good news.

http://economia.publico.pt/Noticia/banca-portuguesa-passa-nos-testes-e-com-a-melhor-nota-do-sul-da-europa_1448557

Guilty

2 important decisions were known today:

- in Portugal, a group of BCP top executives was considered guilty of market manipulation and providing wrongful information. They were thus sentenced to severe fines (totalling just above €4 million) and a ban from banking activity;

- Goldman Sachs is paying a €425 million fine to close a complaint filled by SEC (American supervision autorithy) for providing incomplete information to its clients. This is the biggest fine ever for a financial institution.

Those are historical decisions, for very similar reasons. The intention to knowingly manipulate the financial markets, harming clients interests. And though historical (its the biggest fine ever in the case of Goldman Sachs; in Portugal, there is a general feeling of impunity on these crimes), I personal have a question. There were hundreds of million of dollars in losses related to these practices, and there is no criminal responsibility? By falling short on this point, I am not sure if we are really preventing a repetition of these practices. And that is a terrible sign to the markets...

- http://economia.publico.pt/Noticia/antigos-altos-quadros-do-bcp-condenados-a-coimas-acima-de-quatro-milhoes_1447350

- http://economia.publico.pt/Noticia/goldman-sachs-paga-multa-de-425-milhoes-de-euros-por-enganar-clientes_1447357

3 top economic news in Portugal on 13 July

- Moody's reviews Portugal's sovereign rating to A1 (so, a two grades downgrade);

- The Ministry of Culture will not have its budget cut in 10%;

- There are over 1.2 million debt actions stuck in court

What a mess...

Straight blow

A 20% straight cut in the wages of all public servants - ministers, members of parliament, gardeners,... all. Ouch! But it is a way, as Mr. Ernâni Lopes was saying. And probably a better and less harmful than the increase in taxes we are seeing...

http://economia.publico.pt/Noticia/ernani-lopes-defende-corte-de-15-a-20-no-salario-dos-funcionarios-publicos_1446422

On Paul Krugman's The third depression

The point is when one starts looking only at the dimension of governmental expenditure and not to the quality of it. Governments should deliver positive expenditure into the economy. That means have the basic current expenditures to ensure an efficient operation of the required services and then investment that generates sustainable growth in the economy. The shift that is nowadays necessary is to turn improductive expenditure into growth generating one - and not spend money just because the simple act of doing it is positive.

And, if you generate growth, than, naturally, your issues on debt weight on your economy will decline, for 2 reasons:
- tax revenue base will increase, meaning an increase on revenue;
- the economy basis against which governmental deficit is measured will increase, meaning the percentual (the meaningful measure) will decline.

http://www.portugalglobal.pt/PT/PortugalNews/Paginas/NewDetail.aspx?newId=%7BCCE8BD75-D9A0-4F9C-9640-2A2D92C0C570%7D

On labour laws change

Portugal has a over 10% unemployment rate. Far away from Spain but above the US - for example. And, disturbingly, with a higher unemployment rate at younger levels. And, thus, at higher education first-job seekers. Labour laws are at the cornerstone of the problem, generating lower productivity.

Portuguese Labour laws protect already existing employment. Simplifying (hugely simplifying it), in Portugal, if someone has a job it is very unlikely it will lose it. Laws protect one, as it can only be fired if its role is extinguished or by proven incompetence - extremely hard to prove. If one gets fired, it can appeal to court and (as the Law protects the weakest part involved) is reintegrated in its role until the issue is solved (and it usually takes years).

So, for someone with a mild ambition, the incentive for skills and competences updatement and evolution is fairly poor. And we are in a over-dynamic world, that has nothing to do with the one we lived 10 years ago - it is only necessary to think about the mobile internet, profusion of social online integration, widespread and self generated information and content, SAP management,... This has implications over the skills and competences that are required to perform a job. So, it you don't update yourself systematically, then, your relative productivity and competitiveness fall behind. You start producing less than people who have fresh knowledge and skills - this has nothing to do with age, but yes with the evolution of ones competences. I have no doubt that an experienced person that strives to keep up to date is at least as valuable as a younger one - actually, I personally think that is more valuable, because of experience they have earned. But, in Portugal, there is a large number of persons whose jobs requirements have changed - they need to do it differently, with new skills - and never understood it. That is one of the reasons Portugal's productivity is at least 20% below Germany's.

The new skills and competences that companies require are often in the job market. They are the younger unemployed persons, looking eagerly for a job, despite holding degrees on specific areas. The companies need those fresh competences. The problem is the roles they need them for are already taken by persons that are not able to do the position anymore in an increasingly competitive World. And that can't be fired. Hence, 2 problems root here: high unemployment rate (specially at younger job seekers) and low productivity of the Portuguese economy.

Therefore, yes! A higher flexibilisation of Labour Laws is needed. I must say I don't like the american or chinese model of firing people in a day! I think is barbarian and inhumane. But I would like to see a Portuguese Labour Law that promoted quicker adjustments to market reality and that would allow and increase companies productivity. And that means that it would be necessary to ease on firing and hiring employees. And believe me, this is utterly necessary and crucial for Portuguese economy recovery!

3 clarification notes:

- This is as true for the "blue collar" Labour force as for the "white collar" one. It doesn't make much sense to have persons responsible for thousands of persons literally screwing up companies results through bad management and receiving huge compensations for getting fired. It happens specially at public companies (but not only) and this legislation is one of the reasons.

- I don't like "recibos verdes". I think they are a negative weight on the economy as they don't promote employees evolution and safety. The problem still lies on the 'hardness' of firing and hiring Labour Law. These issues must be dealt together.

- Companies and Unions should promote employees competence and skills evolution. There are European funds available for that. Get use of them. Sorry - get good use of them! Promote productivity! And stop using funds as salary complements!

http://economia.publico.pt/Noticia/governo-admite-aperfeicoar-lei-laboral-mas-pouco-mais_1441174

Life conditions pressire

The below new is no surprise. It is part of the life-conditions improvement trend we will see in China in the next years. As labour becomes richer and more informed and instructed, it will necessarily demand higher living standards, that are more aligned with its higher productivity. And you know, that will drive labour cost up in China, closing the gap vs western labour. It's the economy!

http://edition.cnn.com/2010/BUSINESS/06/08/china.foxconn.factory.ft/index.html?hpt=T2

On unproductive investment

One of the biggest problems with unproductive publicinvestment (the one that doesn't pays for itself according to market rates evolution) is that, for a short while, generates growth and employment. It is an easy fix. It seems good.

But then, the real price comes up. The value it hads to the economy is shorter than if the investment would have been made in other longer-term projects. But, with a 4 years political cycle, that is not an issue for the decisors today...

The word of a master

Stieglitz on the Euro crisis. A reflection in The Guardian.

http://www.guardian.co.uk/commentisfree/2010/may/05/reform-euro-or-bin-it-greece-germany

Spain already reacted

Spain gave today a very strong signal to the market - cutting the number of state-owned companies and highly-placed ministerial roles.

Portugal should have done the same in January...

http://economia.publico.pt/Noticia/espanha-corta-um-terco-das-empresas-publicas-e-32-altos-cargos-para-poupar-gastos_1434832

A quick outlook on Portugal - by The Economist

Very interesting reading. And an amazing and self-explaining chart.

See it here:

http://www.economist.com/world/europe/displaystory.cfm?story_id=15959527

Mario Crespo - Lets pretend... (Portuguese)

Façamos de conta que nada aconteceu no Freeport. Que não houve invulgaridades no processo de licenciamento e que despachos ministeriais a três dias do fim de um governo são coisa normal. Que não houve tios e primos a falar para sobrinhas e sobrinhos e a referir montantes de milhões (contos, libras, euros?). Façamos de conta que a Universidade que licenciou José Sócrates não está fechada no meio de um caso de polícia com arguidos e tudo.

Façamos de conta que José Sócrates sabe mesmo falar Inglês. Façamos de conta que é de aceitar a tese do professor Freitas do Amaral de que, pelo que sabe, no Freeport está tudo bem e é em termos quid juris irrepreensível. Façamos de conta que aceitamos o mestrado em Gestão com que na mesma entrevista Freitas do Amaral distinguiu o primeiro-ministro e façamos de conta que não é absurdo colocá-lo numa das “melhores posições no Mundo” para enfrentar a crise devido aos prodígios académicos que Freitas do Amaral lhe reconheceu. Façamos de conta que, como o afirma o professor Correia de Campos, tudo isto não passa de uma invenção dos média. Façamos de conta que o “Magalhães” é a sério e que nunca houve alunos/figurantes contratados para encenar acções de propaganda do Governo sobre a educação. Façamos de conta que a OCDE se pronunciou sobre a educação em Portugal considerando-a do melhor que há no Mundo. Façamos de conta que Jorge Coelho nunca disse que “quem se mete com o PS leva”. Façamos de conta que Augusto Santos Silva nunca disse que do que gostava mesmo era de “malhar na Direita” (acho que Klaus Barbie disse o mesmo da Esquerda). Façamos de conta que o director do Sol não declarou que teve pressões e ameaças de represálias económicas se publicasse reportagens sobre o Freeport. Façamos de conta que o ministro da Presidência Pedro Silva Pereira não me telefonou a tentar saber por “onde é que eu ia começar” a entrevista que lhe fiz sobre o Freeport e não me voltou a telefonar pouco antes da entrevista a dizer que queria ser tratado por ministro e sem confianças de natureza pessoal. Façamos de conta que Edmundo Pedro não está preocupado com a “falta de liberdade”. E Manuel Alegre também. Façamos de conta que não é infinitamente ridículo e perverso comparar o Caso Freeport ao Caso Dreyfus. Façamos de conta que não aconteceu nada com o professor Charrua e que não houve indagações da Polícia antes de manifestações legais de professores. Façamos de conta que é normal a sequência de entrevistas do Ministério Público e são normais e de boa prática democrática as declarações do procurador-geral da República. Façamos de conta que não há SIS. Façamos de conta que o presidente da República não chamou o PGR sobre o Freeport e quando disse que isto era assunto de Estado não queria dizer nada disso. Façamos de conta que esta democracia está a funcionar e votemos. Votemos, já que temos a valsa começada, e o nada há-de acabar-se como todas as coisas. Votemos Chaves, Mugabe, Castro, Eduardo dos Santos, Kabila ou o que quer que seja. Votemos por unanimidade porque de facto não interessa. A continuar assim, é só a fazer de conta que votamos.”

in http://jn.sapo.pt/Opiniao/default.aspx?opiniao=M%E1rio%20Crespo

Fighting tax evasion - 2 tactics from South America

1) In Argentina, tax autorithies rebate the taxpayer on your debit card expenses. That way, it reduces the opportunity of tax evasion from businesses (especially restaurants, apparel stores,...)

2) In Brazil, when you ask for an invoice (nota fiscal) in a restaurant / shop / ..., that is directly issued by the central taxes autorithy (yes, the service owner needs to log to a governmental portal that will then issue the invoice). Taxpayers are sweetned to ask for invoices, as there is a lottery associated, that (if you win) will give you millions of reais as a prize.

I am not sure if these tactics are working... but they are really different from what I am used to!

It is the euro that is at stake

Europe needs to act swiftly and at one-voice to defend one of its greatest assets. A common currency eases out risks and costs, but is something very hard to achieve for a number of countries - it implies coordination and quickness, in order to develop institucionalised mechanisms that for strong responses in a tough and competitive environment. It is the lack of those mechanisms (being it controls - like not allowing the countries to have huge Governmental Budget deficits - or swift currency solidarity ones) that is endangering the Euro. One-voice and quickness are absolutely essentials.

And let me tell you. Stiglitz (and there is a reason for me to really like him) is absolutely right.- Europe was swift on acting on the financial bank crisis. It was coordinated. Then, why is it allowing such an attack on Greece? "You can't throw a blank check to save the banks and then try to cash in your family" is a great sentence.

Portugal, on the other hand should embrace itself and getting ready. We are next on the list. And the European Union must know that if a second country in the Eurozone falls, the Euro might be doomed...

http://economia.publico.pt/Noticia/joseph-stiglitz-poe-a-hipotese-de-portugal-ou-espanha-falirem_1432928

A brief note on energy

Actually, this is one of the most crucial areas in the Portuguese economy - and one of the few, I must say, I strongly agree with the Government policy. I would endorse these two latest statements:

1) The need to develop an intelligent power grid – it is crucial to optimise energy generation and consumption, optimising costs and use.

http://economia.publico.pt/Noticia/socrates-elogia--investimento-nas-redes-electricas-inteligentes-projectado-para-evora_1431033

2) Alternative energy sources are the answer, not nuclear – nuclear energy has extra-huge setup costs (nuclear plant, but also a new power grid that is able to sustain the bulk force of its generation), learning needs and fossil fuel. All would have to be sourced (and paid for) externally. It is an old technology that is already mastered by a few players – no possibility of developing unique competences in there. Its scale implies that a single nuclear plant would not be profitable – to generate scale economies, we would need at least two. And we would have to pay considerable costs for transport and disposal of used fuel. Too expensive is the right conclusion.

http://economia.publico.pt/Noticia/carlos-zorrinho-afasta-opcao-pelo-nuclear-porque_1431034

On Chinese currency

Actually, this is one of the most forgotten dimensions of China's success. By keeping its currency artificially underpriced, China is bolstering its sales volumes, as they then possess a strong competitive advantage in the World market - a very low price. But this comes with a clear cost - salaries! When keeping the currency undervalued, China is not allowing that increases in productivity have a direct influence on wages, thus keeping the average citizen underpaid vs what it should. In an economy that is only know kick-starting, very controlled, with severe restrictions on information circulation and travelling, this is a problem that can be managed... at least for a short while. But soon, international currency market and internal productivity pressures will climb to a point where holding the nowadays Chinese currency value will cost too much to China. The correction will be strong, sharp and sudden.

http://edition.cnn.com/2010/WORLD/asiapcf/04/04/us.china.treasury/index.html

Corruption

Is incredible how important and urgent it is to stage a true war against corruption in Portugal. Only second to the number of times the issue is in politicians and civil society mouths, with no pragmatic result.

http://www.publico.pt/Política/cravinho-a-corrupcao-politica-esta-a-solta_1430262

Bang on

Simple. Clear. Straight. This editorial from Diario Económico...

http://economico.sapo.pt/noticias/nao-usamos-a-divida-para-criar-riqueza_85435.html

Greece vs Portugal

To keep it short and clear. The main differences between Portugal and Greece are:

- Public accounts transparency. Portugal has not an issue on public accounting credibility. Lets recall that Greece accounting is under fire for suspicious operations that enabled it to hide its mounting debt. That situation is not an issue in Portugal, with public accounting being considered regular by European autorithies;

- Time. Actually, one of the main differences is... time. If Portugal doesn't act NOW (and actually it should have done so years ago) in 5 years time, we will be in a similar situation to Greece. We need to control unproductive public expense and focus on revitalising the economy, choosing and investing in key industries.

http://economia.publico.pt/Noticia/portugal-pode-ser-afectado-pela-instabilidade-na-zona-euro_1428965

Breaking dogmas

The turmoil around Catholic Church priests child abuse in the late XX and begin on XXI centuries risks breaking two important dogmas:

1) Priest celibacy. It is now clear that a relevant number of priests can't fight back sexual surges, despite a vow in that direction. For some of those, children turn out to be a natural escape. In the light of these event, it would be reasonable (at least) for the Church to open a reflection on celibacy.

2) The vision of the Church as a good instituition, devoted at doing so and determined to fight evil. The speed with which it closed its ranks (until it was too late to ignore the abuse) and the policy of secrecy instituted for decades (Centuries? Ages?) show too clearly that this is an instituition composed by men, that aren't (naturally) perfect. And raises the question of law enforcement when necessary, putting aside some of the slack that has been given in some cases.

It would be of great advantage for the Catholic Church to act swiftly on this issue, or face delusion from a World where it already struggles to find a place.

http://www.edition.cnn.com/2010/WORLD/europe/03/15/church.abuse/index.html

Mulheres

Below, the link to a UN article about violence against women throughout the World. An article that deserves all the attention.

http://bit.ly/dcoaGW

My generation's battle

It is said that all generations have their battles. The one's that help the shape of it, of it's personality, values and character. In the 60's it was freedom, the racial issues. Then the Vietnam and colonial wars, the 25th April's and similar revolutions. In the 80's, the Cold war. In the 90's it was personality expression, setting the world forward, shaping an information culture that would explode later on. But my generation's battle, our war will be the environment.

We are at the edge of knowing what we want for our future. And that's what the environmental war is all about. It is not about saving the whales. It is about saving our health in the future and the one of our children's. Like Al Gore quoted, the way our children and grandchildren will live depends on us - and so depends the way they will look at us, as the ones who were brave, intelligent and resilient enough to find solutions for their future, or as the ones who were too lazy and selfish to trade simple instant sweets for the common future good. To we really want to keep on borrowing resources from the future that our children will have to pay?

That is the battle of my generation. And it is a battle I want to win.

Wellfare

Is it right to keep the retirement age at 65?

The world is changing. Like it always did. Over the last century, for every decade, a person's life-expectancy increased by 2 years. That trend is still in effect today, and is especially true in the western World. As important as that, the productive years in a person's life have climbed at even a faster pace - today a 65 year old is not an old man, it's someone active, that can positively contribute to the World in which he lives for still a significant number of years.

Is it right to take these persons out of the work force at such an early age:
- unjustly burdening their labour years?;
- burdening the shrinking younger work force?;
- condemning them to adapt to a new daily situation (retirement is a shocking process) most don't know how to handle?;
- taking experience and expertise out of the economy?

Everytime I think of myself as an old person I think of an active man. I hope to be healthy enough to keep working, to still take part in orienteering meetings (I will rule the veterans races!!!), to be a volunteer actively participating in shaping what I believe to be a better World. That is my dream (together with grandchildren and sons, a loving wife, quality of life...). I hope I make it.

But, to raise the retirement age, to extend the active years for the general population (and to fullfill my dream), a number of points must be taken into consideration:
- continuous education is and will be necessary to ensure adaptation to an ever changing World. When I am 70 I can't be looking at some new technology the way my grandparents looked at cell phones. Constant adaptation will be needed to ensure competitiveness through new skills learning and competences development;
- health education. The western world's generation that will be 60's and 70's by 2050 must learn how to fight its biggest enemy to health and activity - obesity and 'stillness'. We must all need to learn how to take a better care of ourselves through active choices in our current (and the next 30 years') daily life. Things like choosing to do a bit of exercise every morning or afternoon (even if a 30 minutes stroll, that can make such a big difference in our mood). Choosing the right diet - not depriving ourselves of what we like, of our teeth-sweetners, but to know when to eat them and not make them our regular choices. Things like choosing the stairs for that "2-storyes-up" meeting.
- health systems improvement. It is common sense to think that an older population will need better health care systems to keep active. We need to work on that from now on.
- mobility. In some cities around the World an experiment is taking place - volunteers and policemen are being asked to move through these cities (and remember that in 2050 there will be a lot more persons living in cities than in rural areas) with weights on their legs, dirty glasses, uncomfortable shoes. The aim? To understand how the older persons cope with cities that were (really) not made for them - with traffic lights that don't let them time to cross a street, uneven sidewalks, ...
- how can the family support its older members? Despite what some people might think, I am a family person - I think there is nothing more important than the people we love because they are our parents, brothers and sisters, sons and daughters, wives and husbands. Whatever its composition (divorces, same-sexs relationships, non-religious marriages,... - it doesn't matter, that is just a form, not the important look you should give to family). In a complex World, where distances have become so much different than in the past, in which aging will necessarily be different, it will be important to know how to keep the bonding and support, without the burden.

If we want to collect on the seniors experience, to balance wellfare, to keep a well balanced aging process, these are our challenges. Retirement at 65 will not happen in the nearby future, but we must pave the way now for a successful extension of our working years.

PPR

The idea of taxing one of the few savings instruments that is actually working is of pure genius...

http://economia.publico.clix.pt/noticia.aspx?id=1424056

My answer

The euro makes all the sense in the World if:
- all the countries are able to consistently obey the criteria issued for the currency existence - hence, its public finance health;
- the troubled countries can raise its internal competitiveness to compliant levels;
- there is a number of political reforms that lead to a structured approach to the European economy as a whole.

If not, there will always be the risk that the internal pressures from the different paces of the countries will tear the currency apart. Because, and that is for sure, it won't be beneficial (for no one) that the rich countries keep on financing the poorer and troubled economies inefficiencies. For the rich ones, it would be a stretch on their taxes and their investment capability in their own economies. For the troubled economies, it would mean a loss of independence, as there are "no free dinners".

We shouldn't have many illusions. The eurozone inability to provide an answer to these problems over the last years (they were only raised by the global crisis, but the issues existed over the last 10 years) makes the European Union on itself being at stake!

http://economia.publico.clix.pt/noticia.aspx?id=1423830

Portugal is under the floodlight

In Portugal, the general public opinion has no idea on how Portugal is being closely watched by the financial and economic worlds. After the newsflash that Greece was on the verge of bankrupt, the comparisons were immediate. And the word of politicians is measured exactly on its actual weight, the one of persons desperate to build a stronger image and to run away from looming dangers and responsibilities. The TV programs and news articles on the PIGS (Portugal, Ireland, Greece, Spain) financial situation succeed each other both in generic media and in economic ones. The attention that we can guess from the references to Wall Street Journal's articles is only a hint on that. And believe me, it is this attention and the way we show these media (and thus the financial and economical worlds) that we can handle this extremely explosive and dangerous situation that will determine the future of our economy - either as a strong developed country or as a trash bonds supplier.

http://economia.publico.clix.pt/noticia.aspx?id=1423869

http://economia.publico.clix.pt/noticia.aspx?id=1423866

Help?

In a situation of tragedy, in a dramatic situation caused by a massive natural disaster, humanitarian help is needed! We shall all be solidary and send help on the most trusted and adequate way!

Should we help economically if a tragedy has been enhanced by institucional lack of organisation and failure? Look at Madeira's situation today, with a very strong storm boosted by lack of urban planning and an almost total absence of environmental planning. Should reconstructive help (because humanitarian is not questionable) be provided if the reasons that led to this situation aren't fixed?

http://ww2.publico.pt/Sociedade/alberto-joao-jardim-confirma-30-mortos-na-madeira_1423632

Is the euro a bad ideia?

Over the past 2 weeks, I watched and read 3 different American media doing exactly this question. Do you have an opinion?

http://questmeansbusiness.blogs.cnn.com/2010/02/19/was-the-euro-a-bad-idea/

We need a longer term strategy

The figures are out. Portugal Governmental deficit reached 9.3% in 2009. 2010 projections point for a 1% reduction and a 8.3% figure - meaning Public Debt will be at 85.4% of total GDP, a 880 bps increase vs 2009... Public Debt service will weight between 5 and 8% of Portugal's GDP. After a strong slumpdown in 2009, GDP is supposed to laggardly grow at 80 bps in 2010. Portugal is in a severe crisis - no new news... What nobody is relating is that this financial crisis comes together with a economical one. One of a lack of competitiveness of Portuguese companies in the international market - every year we are able to add less and less competitive products and services in the global economy.

There are urgent needs to tackle and actions to be taken. But what is surprising is the lack of consistency on them - the lack of a longer term purpose for all the actions, of a strategy that tells us what and how we should guide our present day actions. Because economy doesn't end on Governmental Budget management!

Portugal needs a long term strategy. Some (few) persons have been telling that for years - the issue seems to be vanished of political speeches and minds for years. The last real effort was the Porter Report back in the 90's - and very little action ensued it. We need to know were we are aiming for, how we want Portugal to be in 10, 20 years - economically talking. How we will grow. How we will support that growth. What is needed to support our vision - what actions, what policies, what choices!

That is above political parties. It is down to society. We have the responsability to demand that strategy!

And lets be honest about it. If we don't, if we are to be unable to build a national economic strategy, we will sink. In debt. In poverty. In less-development. Our companies will not be able to sell products to other markets. They will not be able to compete with foreign companies in our market. They will sell less and less. So they will need less people. Less business and higher unemployment means less taxes. Which means higher debt. Which means higher debt service. Which...

We need to break this flow, this cycle. We need to be able to think longer term! So we can start taking the necessary actions now!

http://economia.publico.clix.pt/noticia.aspx?id=1419911

The Government must provide

Highly recommendable reading about Angola. A special prize for who identifies similarities with Portuguese situations...

http://afonsoloureiro.net/blog/?p=3812

The alarm is ringing!

If there is a confirmation of initial estimations, Portugal's consolidated public debt is already at 100% of national GDP - and can surmount to 120% in 2013 (just 4 years from now).

This is just another figure to sound a strong and persistent alarm at Portugal's financial and economic conditions. We need to act now to avert a even deeper and more dangerous situation - and that might be called a State bankruptcy.

http://economia.publico.clix.pt/noticia.aspx?id=1416579

Football debts

You know when you are looking at a market bubble while everyone sitting on that market seems to be blind and don't do nothing about it? You don't? Then look at football!

Football business is incurring in an incredible level of debt - paying high wages, transfer fees and operational costs at a level that is not payable by its current income. When we look at the debt levels of some of the top outfits in the business and its progression over the last years, we are looking at a huge piece of glass standing in a very small beach - one which that the industry will trample very quickly.

http://edition.cnn.com/2010/SPORT/football/01/06/football.manchester.bayern.debt/index.html

And the wind bring us good news

In 2009, about 15% of total energy used in Portuguese households came from wind energy farms. This is part of a sustainable alternative energy strategy, that is being pursuit by Portugal over the last years - and that is supposed to keep building up over the next ones. The target is that 45% of the energy used in Portugal comes from alternative energy sources by 2010 - nowadays, the raw figure is around 35% and the counpounded one (recognized by Eurostat) is 41%.

That is extremely good news - besides a greener environment, we are trading foreing trade dependency by homeland production. Just what we need when our foreign debt keeps increasing to titanic dimensions.

http://economia.publico.clix.pt/noticia.aspx?id=1416469