18 DE OUTUBRO DE 2014

3

ANEXO

Speech by Mr. Mendes Bota on the debate about “The activities of the Organisation for Economic

Co-Operation and Development (OECD) in 2013-2014

Plenary session of the Parliamentary Assembly of the Council of Europe

Strasbourg, 1st

October 2014

Mr. Angel Gurria,

I would like to hear your comments on the following questions:

First, about public investment on infrastructures. At the Global level, as your report itself admits, economic

growth has contradictory signs. USA is growing strongly, Japan is expected to pick up speed shortly, but the

Euro area is not booming on creating jobs and stimulating investment. Additionally, some emerging economies,

like Brazil, are facing slowing down growth and increasing concerning levels of public debt. Deflation is a risk.

Stagnation does not help to combat high unemployment, and the effects of the financial crisis are still a threat

to economic recovery.

Would you consider, as the IMF surprisingly appears recently to defend, that in such environment of slow

growth, is the time to relaunch public investment on infra-structures, as a way to stimulate the economy, as an

alternative to strict and prudential budgetary policies, that brought austerity measures in many of the European

Estates?

Is it the time for that additional effort? The loan interest rates are low, and the demand is weak on the

advanced economies, and there are still many barriers at the level of infra-structures en emerging and

developing economies.

The question is: the positive effect of public investment on the economy is it able to compensate the level of

endebtment that Estates have to face? And what kind of public investment should it be?

Are there limits to recommend public investment based on debt? Can European countries fear negative

reactions from the finantial markets regarding uncontrolled growth on the cost of financing and additional

pressure over the public debt?

We still remember how the public investment has grown on the years 90’s, to slow down after the deficit

Maastricht criteria on 2002.

But we also sadly remember how the option on public private partnerships to build infra-structures, mainly

on the transport networks and the health system, served on a first moment to limit or disguise the budgetary

impacts of that kind of investments, but resulted on long term negative impacts quite significant, as it happened

in some European Estates, such as Portugal, Spain, Greece, Italy or Ireland, just to mention a few.

And talking about Partnerships, how do you see that the Transatlantic Trade and Investment Partnership,

that is being negotiated between the European Union and the United States, in which ways it might contribute

to stimulate world’s economic growth and create new jobs?

Or, as some people say, will it increase big corporate power and make it more difficult for governments to

regulate markets for public benefit?

Another issue I would like to hear your comments:

On paragraph 8 of your report is said, and I quote your own words, that “the crisis has left deep scars in the

labour market”. And the picture is rather ugly: 202 million people unemployed at the Global level, with many

more low-paid or having precarious jobs.

One week ago, it was signed an agreement between the social partners, entrepreneurs and unions, along

with the Portuguese government, in order to increase the national minimum monthly salary from 485 Euros up

to 505 Euros, after 3 years on the freeze.

The Troika, as well as the IMF, or the European Commission have reacted very negatively, seeing this

agreement as contradictory to the structural reforms, the labor flexibility measures having in mind competitivity

gains on the Portuguese economy, or putting at risk the employment recovery of the last 2 years.

But Mr. Gurria. We are talking about the most vulnerable sectors of the population. We are talking about an

increase of 20 Euros per month after 4 years period without any.