Two years ago Mario Centeno was yet another finance minister of the Eurozone trying to convince his European counterparts that austerity was not working. Portugal was emerging from a severe economic crisis and an equally challenging bailout. Pensions were slashed, education suffered a 23 per cent cut and unemployment reached 17.5 per cent in 2013. The former centre-right government zealously followed the treatment recommended by the IMF and the European Union. But the results were far from satisfactory. Deep cuts were not after all the answer to improve our economy and the life of our citizens. However, things changed dramatically when Antonio Costa´s government assumed office in 2015. After finding an unorthodox formula to govern, the socialists showed Europe that there is an alternative: the solution lies, politically, in reaching broader consensus. Economically, in boosting demand, not suppressing it. [...]
Mr. Centeno’s metamorphosis from outsider to European leader started when Portugal left the EU´s excessive deficit procedure in May. The decision gave Portugal margin to ease austerity and to push away the threat of future sanctions. The decisive moment for Mr. Centeno, however, came the day after. Mr. Schäuble, then Germany´s finance minister, called him the “Ronaldo of Ecofin” and praised him in public. Many understood Mr. Schäuble words as an endorsement. However, few believed Portugal´s finance minister could be on his away to replace Jeroen Dijsselbloem. [...]
Every leadership position in Europe is chaired by the European People´s Party. The exception is the Eurogroup. And there was a gentlemen agreement between conservatives and socialists ensuring that the Eurogroup should be presided by the latter. There was also consensus around the idea that the President of the Eurogroup should come from a smaller country. Another decisive factor was the electoral calendar in Italy – elections will take place during the Spring – and the political instability in Spain. Nonetheless, Portugal´s role as Europe´s success case was a key factor. Whether we like it or not, economic results determine the perception of politicians and governments. And financial stability in a country used to the contrary is a sign of competence. And a synonym of political success, even if the results in other areas are not favourable at all.
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