The Eurogroup, the European Commission and the European Central Bank (ECB) have welcomed the consolidation measures adopted by the Portuguese government by the end of September as well as the commitment of the Irish authorities to correct the excessive deficit by 2014. They also take note on the announcement made by Irish authorities to reinforce banking sector.

The three institutions welcomed on 30 September the ambitious additional consolidation measures adopted by the Portuguese government the day before, which cover both 2010 and 2011. With these measures, decisive steps are being taken towards meeting the budgetary targets of 7.3% of GDP for 2010 and 4.6% of GDP for 2011. In their opinion these budgetary measures will contribute to the stabilisation of the public debt level as planned and to subsequently bringing it back on a downward path.

However, they also urged the Portuguese authorities to back the budgetary measures by reforming the budgetary framework and by adopting further comprehensive and ambitious structural reforms that would enhance potential growth, focusing on removing rigidities in the labour market and in wage formation and improving productivity. This would allow Portugal to improve competitiveness.

Regarding the Irish case, EU institutions took note of the announcement of the Irish government aiming at reinforcing the capital position of the banking sector, including by speeding up the operations of National Asset Management Agency (NAMA) and saw the comprehensive statement of the recapitalisation needs of the banking sector as an important and helpful clarification of the situation.

Following this action, the Irish authorities should develop in view of European authorities its multi-annual strategy in close cooperation with the Commission, in liaison with the ECB. EU institutions are confident about Irish commitment to deliver a revised multi-annual adjustment programme that will bring its deficit under the 3% target by 2014 and its public finances on a sustainable path, and welcome Ireland's commitment to make an additional consolidation effort in 2011 over and above the already announced effort.