The European debt crisis was one of the worse economical disasters in the past decade, and the EU isn’t out of it just yet. Among financially suffering governments, the time has come for Portugal to receive financial aid from EU – but this isn’t something that will happen unregulated. Sadly, along with Greece, Spain, Ireland, Italy, and Cyprus, Portugal now suffers the effects of what global financial specialists call “economic mismanagement”.
EU Funds Intervention Priorities
Decreasing the unemployment rate and stimulating the growth of businesses is one of the main goals that need to be achieved by Portugal. Others, including stimulating the production of goods and services that can be traded, and respectively exported; promoting the development of sustainable resource efficiency; modernize the public administration sector, observe compulsory education to the age of 18, decrease nation-wide poverty levels, and much more.
Social Issues and Solutions with Gambling
One of the major issues that seem to be plaguing the social sector of Portugal is gambling. In a study done last year, it was determined that almost half of the population engages in gambling activities. Whether sportsbooks or casinos (online and land-based) 51% of males and 45.2% of females partake in gambling. This fact alone, shows the high level of gambling addiction people in Portugal have.
The European Union is aware of that fact, and it is why the Portuguese government will review its online gambling laws this year. Upon the proper implication of the newly proposed rules and laws, Portugal will hopefully start seeing some improvement.
The Main Objectives
The financial aid that the Portuguese government will receive, will be allocated appropriately according to a complex strategy of achievable targets devised by the European Union. The most important areas which will be subjected to strategic funding will be the increase of the overall employment rate (with EU est. target at 75%), reduce greenhouse gas emissions, increase the share and use of renewable energy, as well as its efficiency in consumption, reduce the level of early leavers from education and training, and decrease the poverty and exclusion rate significantly.
Who Will Provide the Finances?
It is the European Central Bank and International Monetary Fund that will transfer the amount of €26 billion over the course of 2014 – 2020. As prior examples show, funds will be released on a year-to-year basis, with a post-program surveillance initiated by the EU, which can last at least until 2026. After all, those funds are going to be loaned to Portugal and PPS will remain steadfast until at least of 75% of the received financial assistance is properly repaid.
Getting Portugal out of Danger will Happen Through Education – But When?
While going through a major financial crisis, the Portuguese government performs major budget cuts in its educational sector. With a large amount of young people already skipping school, the salaries teachers are getting paid are not nearly enough to support a proper way of living, let alone teach any subject to young adults and children. Even if jobs were to become available to all, there won’t be any qualified people to take them.
On the bright side, the literacy rate of Portugal’s population is nearly at 96%, which compared to other countries that struggle with their own economic issues is quite high. So far, while there isn’t a clear depiction on how to increase overall education, there are a number of agencies that have been assigned individual tasks to tackle the issues. While the EU has a plan for the granted funds, the Portuguese government also has set their own targets to reach.
The Importance of Portugal to the EU
It is incredibly sad, that due to nation-wide financial mismanagement Portugal economy is in shambles. The truth is, that the European Union cannot allow them to “bankrupt” as the strategic placement of the country combined with remarkable production capabilities isn’t something that can be so easily written off. Portugal is renowned for exporting textiles, clothing, footwear, paper pulp, wine, cork, tomato paste, and other goods – but that isn’t all. It is the maritime connections Portugal has to Africa, Brazil, China, Japan, India, and many other countries that are beneficial to the entire EU.
Current Challenges Faced by The Government
These are a few issues that most countries face on daily basis as well, however, here they are much more prominent, and only contribute to the further degradation of the economical state of the country. A bloated public sector creates not only a slow and inefficient bureaucratic system, but also results in the loss of millions of euros. This combined with the evidence for corruption on a governmental level, makes things even more difficult for Portugal.
The EU Will Deliver Portugal from Trouble
This won’t happen without difficulty, but it will. The European Union has a number of protocols that will be followed throughout the entire period of the financial aid. The spending of every single euro will be closely monitored by Union Officials, as any breach in agreement from the side of the Portuguese government might result in the expulsion of the country from the EU; and nobody wants that to happen. We will see what the year 2020 has to offer.