Pedro Passos Coelho, 46, leader of the Social Democrat Party (PSD,) winner of the June 5 elections, was appointed Prime Minister, Wednesday, by President Cavaco Silva.
The President urged the incoming Prime Minister Passos Coelho to form a new Cabinet to take office next week, in time for the next European Council, scheduled for June 23-24, in Brussels.
European Union leaders have expressed confidence that Portugal will meet initial bailout timetables for Portugal’s 78 billion-euro ($114 USD billion) bailout deal, the main topic on the Council’s agenda.
Following negotiations underway, a consensus is expected by the start of next week regarding the formation of a coalition government led by conservative Pedro Passos Coelho (PSD) and right-wing Paulo Portas (CDS-PP).
Coalition partner Paulo Portas (CDS-PP) should be appointed Deputy Prime Minister. The major contention between the two parties appears to be the number of ministers the new government should hold. The PSD wants 10 appointments while the CDS-PP is aiming for 12.
The new government coalition will implement 13 austerity measures, out of a total of 209 austerity measures, no later than the end of July, in order to meet the terms of the bailout loan with the European Union, the European Central Bank and the International Monetary Fund.
Under the terms of the bailout, Portugal will have to reduce its government budget deficit to 5.9% of gross domestic product this year, compared with 9.1% in 2010, and reach 4.5% in 2012 and 3% in 2013.
The Social Democrats (PSD) won 108 seats out of 230 Parliament seats at the June 5 election, defeating the ruling Socialists (PS). They didn’t attain a majority and a government coalition was formed with CDS-PP holding 24 seats.