Portugal has formally exited the bailout programme supervised by the “Troika” (the European Commission, the European Central Bank and the International Monetary Fund), on the 17th of May, three years after the request for financial assistance, opting not to receive the last tranche. But the programme has taken its toll on the number of Portuguese citizens who tend to trust European Union and their number has sharply decreased.
The results of the spring standard Eurobarometer survey show that only 28% of the Portuguese tend to trust the EU, compared with 45% in 2010. After the enforcement of the bailout programme, the Portuguese trust in the EU fell to 31%, in November 2011. This was a huge decrease for a country that tended to have higher levels of trust in the EU than the average of all member states. For example, in 2004, 63% of the Portuguese tended to trust the EU, compared with 50% in all member states.
In the last year there has been a slight positive change in the opinions of Portuguese. After falling to 24% in May 2013, the Portuguese trust in the EU has feebly risen to 25% in November 2013 and now to 28%, however these are still low figures.
An “ailing” economy
During the 1960’s and 1970’s Europe was a synonym for freedom and equality. When Portugal joined the European Economic Community (EEC) in 1986, this move was seen as an opportunity to achieve development, economic growth and welfare.
The economic assistance which had been offered by the European Community supported Portugal in the path to democracy after more than forty years of dictatorship. However, even though there have been noticeable improvements in the Portuguese quality of life since then, there hasn’t been a total economic convergence with the other European partners as a whole.
According to the Portuguese study “25 anos de Portugal Europeu: a economia, a sociedade e os fundos estruturais” (25 years of Portugal in Europe: the economy, society and structural funds), coordinated by Augusto Mateus for the Francisco Manuel dos Santos Foundation, more than 96 billion Euros in structural and cohesion funds were made available to Portugal from 1989 to 2013. Until the end of 2011, 81 billion Euros had been used. Nevertheless, Portugal remains a ‘cohesion country’.
There was a huge improvement regarding the modernisation of the Portuguese economy and society after the country joined the EEC. The bulk of the population was able to have access to the most basic needs and household equipment, and there was also an increase in the attendance of culture and leisure activities. Between 1986 and 1992 the Portuguese standard of living increased from 65% to 79% of the European average. If the same rhythm had been maintained from that moment onwards, the Portuguese standard of living would have been equal to the European around the year 2000. However in 2010, the Portuguese standard of living was at 81% of the European average.
After the establishment of the Economic and Monetary Union and the introduction of the euro, Portugal became unable to devalue the currency and the limitations of its economy became more noticeable. Low productivity, insignificant economic growth and the increase of unemployment have been some of the long-lasting characteristics of the Portuguese economy. But at the same time there was a reduction of the interest rates which enabled easier access to credit.
With the international financial crisis looming since 2008 Portugal started to face difficulties managing its public debt. The interest rates rose to unsustainable levels prompting the Portuguese government to ask for a bailout worth 78 billion Euros in May 2011. Consequently a number of austerity measures have been applied: wage cuts for public sector workers, VAT rise, higher income taxes, cuts in the higher pensions, and privatisation of public companies.
Echoes of the crisis of trust in the EU
A discernible consequence of the Portuguese economic crisis has been a high unemployment rate. The number of people unemployed rose to numbers never seen since the end of the dictatorship in 1974. According to figures from Eurostat, 15.9% of the people available to work were unemployed in 2012. Whereas in 2013 the unemployment rate had decreased from 17.6% in January to 15.4% in December, the annual average rate increased to 16.5% in relation to the previous year. Lately the unemployment rate has been decreasing. In the first trimester of 2014 it was at 15.1% and in the second at 13.9%.
The Gross Domestic Product doesn’t provide comforting figures. In 2010 it increased 1.9%, but it has decreased 1.3%, 3.2% and 1.4% in the three following years. Public debt was at 123% of GDP in 2013. The best results are in the deficit. It was at 10.2% in 2009, 9.8% in 2010, 4.3% in 2011 and 6.4% in 2012. In the last year it fell to 4.9%.
Accompanying these figures Portuguese trust in the EU has fallen severely. This may be a sign that the Portuguese consider that the EU has not been acting in a satisfactory way in order to overcome the current economic crisis. Portugal has generally been favourable to the European integration, but the current figures must be dismissed as pure euroscepticism.
The percentage of population who trusts the EU in all member states was also decreasing since 2009. However, the fall has not been as huge as in Portugal. According to data from the general Eurobarometer survey in November 2009, 62% of the Portuguese tended to trust the EU, a number that decreased to 28% this spring. On the other hand taking into consideration all member states, trust in the EU fell from 48% to 31% in the same period.
There was also a drop in the number of people who tend to trust in the EU in other European countries which are, or were, receiving financial assistance. In Greece, it fell considerably from 60% in 2009 to 24% in 2014. In the same period there was also a huge decrease in Cyprus from 59% to 25%, while in Ireland there was a less prominent decline from 47% to 32%.
The European Parliament undertook an inquiry on the operations of the “Troika” in Portugal, Greece, Ireland and Cyprus and two reports were adopted. One of the resolutions states that although they lacked transparency and democratic control, the actions of the “Troika” prevented the crisis from getting worst. The other resolution claims that the reforms had negative effects on employment and asks for a revision of the measures being applied.
Such an investigation, however, may not be enough to restore the lost trust in the EU. More must be done in order to guarantee that the population has higher levels of trust in the European institutions and feels represented by them. The European project can only be sustainable if the European citizens recognise it as a positive influence on their daily lives.