Portugal's PM quits after debt-cutting plan nixed

The Associated Press
Wednesday, March 23, 2011; 5:29 PM

LISBON, Portugal -- Debt-stressed Portugal's prime minister says he has quit after opposition parties scuppered his proposals devised to avoid a bailout.

All opposition parties united to defeat Prime Minister Jose Socrates' latest austerity measures in a parliamentary vote Wednesday, saying the belt-tightening went too far.

Socrates said in a statement the defeat made it impossible for him and his government to ensure Portugal's economic future.

The government's resignation was expected after days of political tension, but could re-ignite market anxiety about the financial soundness of the wider eurozone.

European leaders hope to soothe nervous international investors at a summit starting Thursday.


© 2011 The Associated Press