EFAP and post-programme surveillance

The Financial Assistance Programme (the Programme) ended on 30 June 2014. Portugal is under post-programme surveillance, within the framework of the supervision of European institutions.

In line with the European rules, at this stage of enhanced supervision the aim is to monitor Portugal’s economic situation, particularly of policies with a potential impact on its external viability, with a view to assessing the maintenance of its ability to repay outstanding credit. The duration of this stage is directly related to the levels of credit outstanding to the European institutions. The IMF’s financial assistance component has already been repaid in full.

The post-programme surveillance stage involves carrying out biannual missions, usually simultaneously, of staff from the European Commission, the European Central Bank and the European Stability Mechanism. IMF experts have also taken part in these missions. Within the scope of its powers and responsibilities, the Banco de Portugal prepares and monitors these missions, as well as discussions with external experts.

The 2011-14 Financial Assistance Programme

The Financial Assistance Programme (the Programme) was agreed between the Portuguese authorities, the European Union and the International Monetary Fund (IMF) in May 2011. With a strategy aimed at restoring the confidence of international financial markets and promoting competitiveness and sustainable economic growth, the Programme was based on three pillars: fiscal consolidation, stability of the financial system and structural adjustment of the Portuguese economy.

The total amount of financing for the 2011-14 period was €78 billion, of which €52 billion corresponded to financing through the European mechanisms (European Financial Stabilisation Mechanism and European Financial Stability Facility) and €26 billion corresponded to assistance from the IMF, under an Extended Fund Facility. Of this total amount, €12 billion was allocated to the Bank Solvency Support Facility.

12 review missions of the Programme took place. In total, Portugal received 11 disbursements, corresponding to approximately 97% of the agreed package. The Programme expired on 30 June 2014, without the disbursement of the last agreed tranche.

The Banco de Portugal’s various responsibilities for the Programme’s implementation were related to its mandate to safeguard the stability of the Portuguese financial system. The Bank also directly and indirectly contributed to other Programme actions – e.g. by providing economic and financial advice to the Government and reporting statistical data) – and participated in different initiatives led by the Portuguese authorities. The Bank also shares responsibilities in processing the financial assistance’s disbursements and interest payments, acting as an intermediary between the financing bodies and the Portuguese Treasury and Government Debt Agency.

On the related page below, is presented a series of documents on the Financial Assistance Programme and the post-programme surveillance stage, as published by the relevant entities, particularly the European Commission, the European Central Bank, the International Monetary Fund and the Ministry of Finance.