Portugal's Foreign Minister Paulo Portas resigns

PanARMENIAN.Net - Portugal's Foreign Minister Paulo Portas has resigned, the president's office said on Tuesday, July 2 in a further blow to the center-right coalition that has kept the country's international bailout on track, Reuters reported.

Finance Minister Vitor Gaspar, the architect of the spending cuts and tax hikes required by the bailout, resigned on Monday citing the growing erosion of public support for the program.

Portas heads the rightist CDS-PP party and without its support, the government would lose its majority in parliament.

"It looks like the end-game for the government," said Antonio Costa Pinto, a political scientist. "There is a possibility of the government staying on in minority with conditional support from CDS-PP, but the opposition will demand a new election and the president will be in a difficult situation."

Portuguese bond prices fell sharply after the announcement, with the returns investors demand to hold 10-year bonds rising 35 basis points. The news weighed on the euro.

Portas has been at odds with Prime Minister Pedro Passos Coelho and Gaspar over their adherence to the terms of the 78 billion euro ($102 billion) bailout, which has sent the country into its deepest recession since the 1970s.