Akhir 21, 1432 H/March 26, 2011, SPA -- Portugal's caretaker government could seek a bridging loan if the country's financial crisis escalates, the leader of opposition Social Democrats (PSD) said on Saturday, adding he hoped no bailout would be needed, Reuters reported. Pedro Passos Coelho told Reuters in an interview that his party is fully committed to meeting budget goals agreed with Brussels, saying of any bailout: "I think we must avoid a situation like that." However, he added that if there is an "emergency situation and there is a need for an emergency loan to avoid a Portuguese default situation" until an expected snap election in June, the caretaker government has the power to seek one. Portugal slid into political crisis this week as the Socialist minority government resigned after Passos Coelho's party and other opposition parties rejected austerity measures in parliament. The Socialists will remain as a caretaker government for now. There are concerns in financial markets that the political limbo that will remain until a snap election could make it very difficult for Portugal to finance itself in debt markets, especially as it has to meet a bond payment in April of 4.5 billion euros ($6.4 billion). Another payment of a similar size is due in June. The government has said it expects no problem in meeting its debt payments. "I don't think anybody in Portugal, or in Europe, would leave Portugal to default because we are having elections," Passos Coelho said. "Clearly not." Portuguese bond yields have shot higher since the crisis erupted and two rating agencies downgraded the country's credit ratings because of the uncertainty created by the government's resignation. The crisis prompted many economists to predict Portugal will need a bailout like Greece and Ireland soon. Passos Coelho justified his party's rejection of the government's latest austerity plan -- the trigger for the current crisis -- by saying the government's measures do not go far enough to fix Portugal's problems.
