Brussels, 08/05/2013 (Agence Europe) - On Tuesday 7 May 2013, Portugal achieved its first successful long-term bond issue since it was forced to ask for international aid in May 2011, at the same time as the country's international lenders were in Lisbon to assess a new austerity drive to drum up €4.8 billion (unveiled last week by Portuguese Prime Minister Pedro Passos Coelho, see EUROPE 10841).
Portuguese Finance Minister Vitor Gaspar said the bond issue was a sign that Portugal's access to the money market was back to normal and was a key stage in leaving the bailout programme (in June 2014). On Wednesday, the European Commission said the bond issue was an encouraging sign of gradual return of investor confidence and the Commission is pleased to see that Portugal has taken the necessary measures.
The Portuguese treasury successfully sold €3 billion of ten-year bonds for 5.67%, sharply down on the yield demanded for ten-year bonds in January 2011 (6.76%) only three months before the country requested international aid. The new austerity drive increases the retirement age from 65 to 66 for full-time workers, reduces the 700,000 civil servants by 30,000 and extends the working week in the civil service from 35 to 40 hours a week. (MB/transl.fl)