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Portugal delivers on privatisation target

Thursday, December 05, 2013 - 01:54

Dec 5 - Portugal's government is selling off its mail service as part of its bailout agreement. Postal workers are furious but Lisbon hopes it will keep them on track to exit their international bailout next summer. David Pollard reports.

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Shares in CTT opened seven percent up on their offer price. A strong signal of a strong debut - despite misgivings by postal workers and the public. Following successful IPOs in the UK and Belgium, a seventy per cent stake was up for grabs, pocketing the government around 580 million euros. It's promoting the privatisation as a milestone on Portugal's road to recovery, even if postal workers fear some colleagues could fall by the wayside. (SOUNDBITE) (Portuguese) MAILMAN, NUNO ANDRADE, SAYING: "A private company doesn't want workers who can't do what others can do. Many people, older, slower, more restricted than someone young like me. A private company doesn't want that." Portugal has to sell off state assets as part of its bailout programme, which it wants to exit by next summer. It hopes a successful bond issue this week may also convince investors that Portugal is getting its act together. There are still doubts. Troika officials from the IMF, the ECB and the EU are currently reviewing progress. They're expected to examine very closely whether Portugal can deliver drastic reductions in state budgets.... .. a tough ask made tougher by the possibility of legal challenges to cuts in civil service wages and pensions. Ishaq Siddiqi of ETX Capital. (SOUNDBITE) (ENGLISH) ISHAQ SIDDIQI. MARKET STRATEGIST, ETX CAPITAL, SAYING: ''This is a country which is suffering from vast amounts of manufacturing and industrial contraction. They don't really produce anything any more. And I think when it comes to Portugal itself it's a country with political instability on board. And I think it's very shaky going into the next two or three years.'' On its own merits, the privatisation programme looks more positive. Portugal has already sold stakes in power firms EDP and REN and airport operator ANA, raising 6.4 billion euros Meaning that it's beaten its 2013 bailout target by nearly a billion.

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Portugal delivers on privatisation target

Thursday, December 05, 2013 - 01:54