Portugal and PIGS: Main Lessons of Economic Recovery

... Lisbon signed up to a three-year bailout and economic program that included a 78-billion-euro credit line. The European Financial Stability Facility (EFSF) and European Financial Stabilization Mechanism (EFSM) provided 26 billion euro each, while the IMF allocated 27.5 billion euro to encourage Portugal’s financial stabilization. To meet the creditors' demands, the government took on austere economic policies incorporating lower budget spending, higher taxes, the privatization of state enterprises, labor market liberalization, an easier ...