The End of Portugal’s Bailout Programme: A Sign of Hope for the Eurozone?

Portugal has left the European Union/International Monetary Fund three-year bailout programme without renewal. It is the third eurozone Member State to take such a step, which may be interpreted by the international financial markets as a sign of the end of the eurozone’s economic troubles. This takes place against a backdrop of new circumstances, such as ongoing reform of the eurozone architecture, in which economic governance instruments such as the banking union, the fiscal compact and the European Semester are gradually being introduced. It is also a small victory for the supporters of austerity policy, notably Germany. Portugal could be used as an example to the other eurozone countries in trouble, to motivate them to continue harsh reform path. Although Poland tackles problems of a different scale, it should assess the Portuguese case in its budget consolidation plans.