International Viewpoint Archive

The Fourth International’s English-language review, from 1982

Portugal: A Country Whose Economic and Social Problems Are Concealed by Lavish EEC Subsidies

· International Viewpoint No. 206, 13 May 1991 · pp 24-26 · 2,115 words

Portugal World economy

On the EEC drip-feed FIVE YEARS after joining the European Economic Community (EEC), and the stabilization, for the first time since the anti-dictatorial revolution of April 25, 1974, of a rightwing government, Portugal is again in turmoil. The changes are visible in the economy and in social and political life. FRANCISCO LOUÇA B EFORE the fall of the dictatorship, Portugal was characterized by semi-subsistence agriculture which was unable to supply the home market. The industrial structure was based on the advantages offered by cheap labour and by the creation and strengthening of industrial and financial conglomerates, more or less protected from foreign competition; and by a poorly developed service sector, which was at the beck and call of the strategic decisions of the main national financial groups. Fifteen years later, Portugal having joined the EEC, this is still to a large extent an accurate picture of the country. However, after five years of EEC membership, new elements of dependence have accentuated the submission of Portugal capitalism.

Community policy has organized this dependence by casting Portugal in the role of provider of cheap and poorly qualified labour, along with some raw materials and industrial products with a low level of value added for the home market. Brussels has in fact worked to maintain the basic factors which have crippled Portugal's economy since the demise of the colonial empire. What some have called "the discovery of the sea route to Europe" has become an inevitability for Portugal.

This policy has caused a series of social crises. One of the most significant aspects of the situation is what has happened to agriculture. A large part of the forests and cultivatable land have been replaced by plantations of eucalyptus, a tree of Australian origin which grows very fast and absorbs large amounts of

PORTUGAL water, and which is used for the production of paper pulp for export. This industry, which is conducted along the whole Portuguese coastline, is highly polluting.

Protests by farmers against this scourge have had little effect. It has not been possible to halt the extension of the cultivation of eucalyptus, which is protected by an array of subsidies and incentives, and when necessary by the police when demonstrations are held on the issue.

Portugal's economic opening to the outside world has gone ahead apace — during the past decade foreign trade has grown by an annual rate of 4.8%. Exports represent between a third and a quarter of total domestic product.

transport equipment and food products — remain.

All these figures point up the place of Portugal in the international division of labour: it is an economy that is intensively based on the use of labour power in sectors with low capitalization and thus with low rates of productivity. Influx of European capital

At the same time, joining the EEC has increased the rulers' room for manoeuvre, insofar as the balance of payments has been clearly favourable thanks to the arrival of capital -

30 years for the killers of Zé

AT the end of March 1991, the criminal court in Lisbon sentenced four skinheads to a total of 30 years in jail. These were the most visible members of the group that, on October 18, 1989, assassinated José Carvalho (known as Ze) outside the office of the Revolutionary Socialist Party (PSR - Portuguese section of the Fourth International) of which he was a prominent member.

Other members of this fascist group were sentenced to a total of four years

The fragility of this economic structure is shown by the fact that, during the whole period of EEC membership, the main Portuguese exports have remained the same — clothes and shoes, wood, paper and cork, skins, leather and textiles. At the same time the same three areas of dependence — mechanical equipment, capital. Over the past five suspended. Another was referred to a juvenile court and two were found not guilty. This is the end of a trial rendered extremely complex both by virtue of its political implications — the fact that this was a neo-Nazi group with a policy of racial and criminal violence was empnasized by the three juages, wno emphasized by the three judges who years, the government has been given blank cheques to administer sums of money, promotions, and promises.

One of the most significant effects of this policy has been its consequences for young people. In the first three years of EEC membership, more than 600,000 youth, out of an active population of a little more than four million, have taken part each year unanimously agreed the sentence - motelacreed the contonce witnesses, a month and a half of continuous session, and thousands of nal trials in Portugal in recent years and certainly the one that drew the most media attention. The case will which will give the final verdict within three or four months. * the more modern employers and techno- the more moder employers ana lennocrats and who have been the main beneficiaries of the changes after the 1987 elections'. At that time the equilibrium was shaken, the PDS winning an absolute majority and the CDS retaining a mere four deputies with less than 5% of the vote.

The effects of this change, after the first right-wing government had concluded its normal four-year term, have also made themselves felt on the left. With the election of Mario Soares to the presidency in

1986, his Socialist Party (PS) finally had the opportunity to renew its leadership team. A bitter internal struggle between the frankly "Soarist" currents and a new majority, has paralyzed the PS for years, a situation all the more serious in that the prospect of a prolonged period out of power sapped the loyalty of some of its traditional clientèle. Vitor Constancio, elected general secretary, was forced to resign because he criticized the obvious interference of Mario Soares in the party's life and notably its financing. The

1. In the 1987 Portuguese elections, the right obtained the majority of votes cast for the first time since the fall of the dictatorship. The PDS, led by Prime Minister Cavaco Silva, obtained 50.5% of the vote. The

Socialist Party scored 22% and the Communist Party's share of the vote fell from 15% to 12%. May 13, 1991 • #206 International Viewpoint in training courses paid for by the EEC, with a grant higher than the national minimum wage. It has, furthermore, been possible to do more than one course at a time. Thus the problems of the national education system - the bad management, low quality of secondary education and the restrictions on university entrance - have been covered up insofar as many of the young are on courses which are useless but individually remunerative in the short term.

During the same period, the political landscape has significantly changed. The right has won back some of the influence in the state apparatus that it enjoyed under the dictatorship. The Portuguese right has traditionally been divided into a minority Christian democratic current, the Democratic-Social Centre (CDS) and a so-called "social democratic" current, the PDS, which brings together most of the European Economic Community (EEC); the

Gross Domestic Product (GDP) increased by 4.4% in 1990. Investment grew by 8.7% (more than 60% of it foreign capital) to a value of $3.6bn. Officially, less than 5% of the active population (Portugal has 10.3 million inhabitants) are unemployed. But the figures hide a more sombre reality; inflation reached 13.4% in 1990, more than double the EEC average. The government hopes it will be below 11% in 1991.

Between 1989 and 1990, imports have grown very much more quickly (31.5%) than exports (25.2%). The budget deficit, around 7% of GDP ($61 m), has led to the maintenance of prohibitively high interest rates (between 21 and 23% for the big companies, and 24 and 26% for small) which penalize industry, particularly the traditional sectors like agriculture and textiles (the two biggest fields of activity) which are experiencing the most severe crisis of their history.

Agriculture employs around 19% of the active population but accounts for only 6% of GDP; the country depends on imports for more than half of its food consumption. Productivity is amongst the lowest in the EEC and most farmers are reliant on state aid. Most Portuguese firms are not prepared for the inevitable sharpening of competition which will follow 1992 and the single

European market. Weak industrial productivity and the poor quality of Portuguese manufactured products are compensated for by the lowest labour costs in the EEC, Portugal's principal market; but competition from third world countries is significant. In 1992, many small and medium enterprises will have to modernize or close - the latter being most likely for the majority.

The educational system is in a very bad state;

teachers are underpaid and the infrastructure very basic. Illiteracy, which affects 15-20% of the population, continues to grow. *

"structural" assistance and other sorts of aid — which has been provided in the framework of the "structural convergence programme". The sums involved do not weigh for much in the European context, but they have been more than enough to render the country service in terms of liquid

The Portuguese economy and by virtue of procedural difficulties.

More than ten lawyers and hundreds of

THE Portuguese rate of growth continues to be much higher than that of the other countries of pages made it one of the biggest criminow go to the supreme court in Lisbon,

PORTUGAL / WOMEN new leader of the PS, Jorge Sampaio, was, for a brief period after the revolution, a leader of a far left organization, the Movement of the Socialist Left (MES).

The party most profoundly affected, however, has been the Communist Party of Portugal (PCP), after the introduction of perestroika in the Soviet Union, always presented by the party as a model. The impact of the denunciation of the Brezhnev era and the disintegration of Stalinist power in eastern Europe, and now in the USSR itself, resulted in confusion and discouragement among the PCP cadres. The party has not made any balance sheet, nor repudiated in a clearcut fashion positions such as its support for the invasion of Czechoslovakia in 1968.

The 11th Congress of the PCP witnessed the appearance of several dissident voices in the regimented hall, but the critical currents ended up by splitting, with some of their leaders, notably the leaders of the main union confederation (the CGTP - General Confederation of Portuguese Workers), moving closer to the PS.

In this context the effects of the right's political oftensive have also made them- political offensive have also made themselves felt in the social domain: clearly defensive popular struggles take place ever more rarely and are less generalized than before. Union assemblies have disappeared; factory meetings are rare and it has become much more difficult to win demands.

Intensive exploitation of labour

Accompanied by a slight rise in unemployment, there has been a real economic expansion (encouraged by EEC funds) in the last five years. The basis for intensive exploitation of labour has been consolidated (women's piece work, the farming out of work by the big firms and also in certain state sectors, child labour in the north) without any union protection.

A new phenomenon, racist violence and organized attacks by neo-Nazi groups — including the assassination of José Carvalho, a militant of the PSR (Revolutionary Socialist Party — Portuguese section of the Fourth International) - have also been a feature of recent years.

1991 will see new parliamentary elections, after the re-election of Mario Soares to the presidency. The governing PSD will not have an easy ride, given the wearing away of support caused by the chaos it has brought to the education system, and its unfulfilled demagogic promises.

There have also been revelations about corruption, leading to the sacking of ministers. At the same time, and for the first time, the election will make it possible to 26 measure the extent of the recomposition on the left. * International Viewpoint #206 • May 13, 1991

CONTRARY to common

100 million belief there are today more men in the world than women. But this is women are not due to natural causes. While 105/106 boys are born for every missing

100 girls, this is more than compensated for by the higher death rate among men of all ages. Thus in regions where the two sexes are both adequately fed clothed and sheltered (Europe, North

America, Japan), the overall male/female ratio works out at

103-105 women to each 100 men.

On the other hand there are only 87 women for every 100 men in India's Punjab, 90 in Pakistan, 93.3 in India, 94 in

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