EU-IMF face Portuguese pressures on debt rescue

The country is eight weeks away from a risk of defaulting on its debt and faces a general election on June 5.

The officials from the European Union, the European Central Bank and the International Monetary Fund had talks lasting nearly two-and-a-half hours with leaders of the main opposition Social Democratic Party.

Portugal faces an early general election on June 5 because the opposition rejected austerity cutbacks proposed by outgoing Socialist Prime Minister Jose Socrates.

The bailout plan is supposed to be agreed by mid-May so that the political parties can take it into the elections.

Pedro Passos Coelho, the head of the centre-right opposition which is tipped in surveys as the likely winner of the election, has pledged his backing to government efforts to tackle the crisis.

The EU and IMF officials only met politicians on the right of Portuguese politics because left-wing parties, opposed to open-market remedies, declined on Monday to participate.

The negotiators, who declined any comments on the days, sat down later in the day with representatives of Portugal's two main unions which are concerned that a future austerity programme would lead to reforming the country's work laws and unemployment benefits.

"We are negotiating with international organisations which have brought an extremely hard proposal," said the secretary general of the UGT trade union, Lusa Joao Proenca.