CRI听力: Portugal PM Socrates' Resignation Overshadows EU Summit

Portugal is now in the spotlight at the EU summit, following the resignation of its Prime Minister, who has quit following the parliament's rejection of his government's austerity programme. The ongoing summit has been set up to try to sign off on closer economic cooperation and overhaul of the size and powers of the region's bailout fund.

However, as our He Fei reports, it now seems there won't be any actual progress as expected.



 The political situation in Portugal has dominated the start of the summit of EU leaders, with Lisbon rejecting intense pressure to go for a bailout package.

Prime Minister Jose Socrates quit yesterday after Portugal's parliament rejected new austerity measures that his government had proposed to try to avoid an EU bailout or IMF financial assistance.

Despite stepping down, Socrates is still in attendance at the two-day summit, and remains adamantly opposed to requesting aid.

"I am here with a one and only concern: to defend Portugal and to defend the common currency and defend the European project."

Greek prime minister George Papandreou, whose country was the first to get an EU bailout, says it is time to send a strong message to the markets.

"The challenge now is that Europe as a whole sends a very strong and convincing message to the financial markets that it is supporting a stable euro and is supporting all euro zone countries."

Only a few days ago, the two-day summit had been expected to deliver a "comprehensive package" of new measures designed to try to reassure the financial markets.

But now the leaders have been thrown onto the defensive, and are now struggling to show unity and resolve.

Euro zone leaders have agreed, in principle, to write limits on public debt and budget deficits into national laws, meeting a German condition for a stronger euro zone financial safety net. But the details still need to be worked out.

The agreement, or ''Competitiveness Pact'' may also include higher retirement ages, wage growth in line with productivity and bank resolution schemes.

For German Chancellor Angela Merkel, the ''Competitiveness Pact'' is THE solution to the euro zone debt crisis.

"Germany has worked for months to reach this day in order to have a stronger and more concrete stability and growth pact, to have a permanent safety mechanism and that includes a more flexible way to amend the treaty and to do something to improve the competitiveness of euro zone countries and of those countries who want to take part in this pact. So this is what we could decide for this comprehensive package. This would be a real progress."

Draft conclusions drawn up ahead of the meeting has revealed that a decision on how to increase the lending capacity of the bloc's current bailout fund -- the European Financial Stability Facility -- will be delayed until at least the middle of this year.

Finland is the main obstacle, given that it's parliament has been dissolved ahead of elections on April 17th, and as such, can't sign off on the deal.

For CRI, I'm He Fei.