(Photograph: Mário Cruz /LUSA)

Portugal is heading in the right direction but structural reforms have to be increased, said Vice-President of the European Commission and EU commissioner for Competition Policy Joaquín Almunia Friday, 13 July, in Lisbon.

Structural reforms must go deep into the country’s economic fabric, including for state-owned enterprises and the financial sector,” stated Almunia.

Joaquín Almunia also said these reforms were not an imposition from the EU, and that “each member state must live up to its responsibilities. Without adopting responsible decisions at home, it is not possible to ask for solidarity from our partners.”

The European official said proof that Portugal was heading in the right direction was the change in the trade balance that points towards the first surplus since 1943.

Joaquín Almunia was invited to take part in a conference in Lisbon which discussed the new Portuguese competition law,  praised by Almunia in his address, saying that it goes beyond the European law.

As for the country’s banks, Almunia said the Commission was looking at a long-term prospect regarding Portugal’s banking system.

We are currently working with a number of Portuguese banks, including BCP and BPI, which were recently recapitalised and must notify their restructuring plans to us by the end of the year”, Almunia said, adding that they are also “working on the approval of Caixa Geral de Depósitos’ recapitalisation and will enter the discussion of its restructuring plan.”

When asked if the deadline of Portugal’s bailout programme could be extended for another year, the vice-president said the topic was to be discussed between all parties involved including the European Commission and the International Monetary Fund, and would not give his opinion.