Welcome to the Official page of the Presidency of the Portuguese Republic

The Government which is empowered today was formed following the political crisis arisen by the rejection of the Programme of the XX Constitutional Government. In line with the Constitution this automatically implies its dismissal, with the Executive limited to the practice of acts strictly necessary to ensure the conducting of public affairs.

To the outgoing Prime Minister, who headed the Portuguese Government for over four years, as well as to the members of his governments, I express public recognition for the services rendered to the Country under extremely difficult circumstances, and wish them the best possible personal and professional success.

Resulting from the Government’s dismissal, and keeping in mind that we are going through a period during which the President of the Republic is unable to dissolve Parliament and call for new elections, I decided to hear the opinions of social partners, institutions and individualities in our public life conversant with the economic, social and financial reality of the Country.

In these audiences, I obtained relevant information on the options of economic policy that must be followed in order to preserve the path of growth and job creation, the stability of the financial system and the financing of the State and the economy, as well as the importance of compliance with the rules of budgetary discipline and sustainability of the public debt.

Meanwhile, four political factions signed three documents with different approaches, designated as “joint positions”, in order to present an alternative governance solution.

The referred documents omit any reference concerning several features essential to political stability and Government durability, raising queries that, in spite of the efforts developed, were not fully dispelled.

This is an unprecedented solution in the history of our democracy, supported by a parliamentary majority committed not to inhibit the coming into office of a new Executive, which confers on the involved political factions the responsibility for the Government empowered today.

Ladies and Gentlemen,

The coming into office of the XXI Constitutional Government is the start of a new political cycle.

However, the Country’s strategic objectives continue as before. As I stated on 30 October ultimo, «the supreme national interest is very clear: we must consolidate the path of economic growth and preserve external credibility. We cannot recede in a course that was arduous, in which many sacrifices were demanded from the Portuguese.»

In this sense, and as I then stated, and I quote «it is demanded from the Government which is now empowered that it respects the European rules of budgetary discipline applicable to all Euro Zone countries and subscribed by the Portuguese State, namely the Stability and Growth Pact and the Budgetary Treaty, in order that Portugal swiftly exits the Excess Deficit Procedure, reduces the ratio of public debt and achieves the medium term objective set for the structural deficit.»

These are State commitments that Parliament voted with overwhelming majority.

In the historic moment we are crossing, it is an illusion to believe that a country such as Portugal can dispense with the confidence of the financial markets and of external investors and, of course, of the international institutions.

Concerning this, it is important to consider certain elementary realities of political economy which, having been put forward by independent and credible bodies, a Government cannot but have in mind.

Already this month, OECD, with reference to Portugal’s economic perspectives, stated: «non-compliance with budgetary objectives negatively affects confidence and increases loan interest».

On another hand, in its last report, the Public Finance Committee warned, and I quote: «the Country requires a model for the stable growth of the economy and employment, based upon the increase in productivity and in the competitiveness of the economy, and not in its indebtedness or in the increase of public expenditure».

Referring to a policy that would place in question the measures required to exit the Excessive Deficit Procedure to which Portugal continues subject, the Public Finance Committee adds that the impact of a policy in which growth would be impelled by private consumption and in the fall in savings would be unsustainable, as a result of the increase in imports and the worsening of the balance in external accounts.

The Public Finance Committee also leaves, in its recent Report, a very serious warning: «a policy veered on the short term and based upon a minimalist degree of budgetary consolidation, apart from not complying with current European rules would also have negative implications on the Country’s indebtedness and productivity».

Likewise, the Bank of Portugal, in its October 2015 Economic Bulletin states, unequivocally: «The compliance of the commitments of the national authorities in the field of the European budgetary rules is essential to ensure the reduction of the public debt as a percentage of GDP, which is a latent vulnerability of the Portuguese economy».

Particular regard must be given to the defence of the stability of the financial system, due to its central role in the financing of the Portuguese economy. Our entrepreneurs and workers must be encouraged and respected, since they are the true heroes of the increase in exports. Unemployment must be combated through the growth in the economy.

It is within this picture of enormous responsibility that the new Executive initiates its office.

In the challenges they are facing, this Government and its Prime Minister can count upon the institutional loyalty of the President of the Republic for the safeguard of the supreme national interests.

Not abdicating from any of the powers conferred by the Constitution on the President of the Republic – and I recall that of these powers only that of the dissolution of Parliament is inhibited – and with the legitimacy resulting from having been elected by direct and universal suffrage of the Portuguese, I will do all in my power in order that the Country does not waver from the current path of economic growth and job creation and preserves external credibility.

Since this is a minority Government, and it not being entirely clear from the documents signed between the parties that the durability within the term of a legislature is guaranteed, the empowerment and taking office of the new Executive will be a test of dialoguing capability not just with the remaining political factions but also with the social partners and civil society institutions.

It is fundamental that social concert is valued as a decisive element for the Country’s development and for the cohesion of Portuguese society. Draining the role of the social partners would carry a very heavy cost for our future.

I wish Your Excellency. Mister Prime Minister and the members of the XXI Constitutional Government, the best of success in the demanding functions you are now taking up.

Thank you very much.