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Portugal energy boss: 'Don't believe' country will need second bailout

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Story highlights

  • Boss of Portugal's largest energy provider says country will avoid second bailout
  • Antonio Mexia told CNN 'I don't want to believe' in the need for more financial help
  • European leaders have taken steps to deepen financial ties in the eurozone
  • Mexia said long-term conditions needed to be created for the transfer of wealth between North and South

Portugal will avoid a second bailout when its current financial aid program expires in the spring of 2014, according to the boss of the country's largest energy provider.

Speaking with CNN's Isa Soares, Antonio Mexia, head of Energias de Portugal [EDP], said: "I don't believe and I don't want to believe [in] the needs of a second bailout."

He added: "At the Portuguese level overall we are doing what we need to do to avoid a second bailout."

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Mexia's comments were made on October 2 before the troika -- made up of the International Monetary Fund, the European Central Bank and the European Commission -- approved Portugal's economic progress.

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The latest visit from creditors means the embattled eurozone nation will receive the next tranche of its 78 billion euro ($111 billion) financial aid package.

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    However, government official were unable to convince creditors to ease the country's deficit reduction target for next year.

    Portugal's coalition government, led by Pedro Passos Coelho, must find billions of dollars in additional spending cuts, despite juggling an already austerity-fatigued electorate, mass unemployment and questions over political stability.

    But Mexia said: "I think today politically you have higher stability than 6 months ago, that's clear. Political stability has a lot to do with the results of let's say, this bailout package."

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    With the Portuguese economy forecast to contract 2.3% this year, according to Eurostat, Mexia believes the government can spur growth by lowering taxes, particularly on corporations.

    He added that changes need to be made at European level to solve the region's debt crisis.

    Mexia told CNN: "You cannot have a common currency without having additional fiscal policy integration, without having a higher budget at European level, without a new mechanism for the structural funds."

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    In recent years, European leaders have taken steps to deepen financial ties including the signing of a Stability and Growth Pact in 2011 and plans for a banking union in the eurozone.

    Mexia added: "You need to create long term conditions to have the transfer of wealth between the North and South in a positive way because also the South is a significant market for the wealth in the North."

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