Visiting German president praises Portugal for "successful reforms"

LISBON, June 24 (Xinhua) -- Visiting German President Joachim Gauk congratulated Portugal for its "successful reforms" on Tuesday during a two-day official visit.

"Here, in Portugal, we have a good example of successful reforms and of European solidarity," Gauk said at the Portuguese presidential palace Lisbon, after he was asked by a German journalist regarding Portugal's Constitutional Court's decision to block several measures from the state budget for 2014.

The Portuguese court recently sparked concern in the coalition government after it ruled against several austerity measures including cuts to public sector pay.

Portuguese President Anibal Cavaco Silva said that he was convinced that Portugal "continues on the road of consolidation of its public accounts" and in the "pursuit of reforms that are indispensable for the Portuguese economy."

"We learnt a lesson in the past years," he added. "The Portuguese have been extremely responsible and now we want to start a new phase of economic growth and creation of jobs, particularly thinking of our youth, who have had difficulties in entering the labor market."

Both presidents pointed to the positive relations between the two countries and Joachim Gauk said he was willing to enforce investments in Portuguese companies like Volkswagen's Portuguese production unit Autoeuropa, and German camera company Leica.

Asked whether Germany was sympathetic to countries struggling like Portugal and Greece, Cavaco Silva said that "in fundamental issues there was never a lack of German solidarity in relaxing deficit targets, debt maturities or the financial framework for 2014-2020."

His German counterpart said Germany's solidarity was present in "big financial means" which were made available to Europe and in its support of the European financial stability mechanism.

Portugal's EU-IMF creditors modified Portugal's 2011 bailout program a year after it was signed, agreeing to relax Portugal's deficit targets both for 2012 and 2013.

Meeting its deficit targets was essential for Portugal to receive funds under its 78-billion-euro (106-billion-U.S. dollar) bailout program. In fact, the debt-laden country opted to forego the last tranche of its aid, because it had been unable to comply with the measures imposed following the Constitutional Court's ruling.

Gauk arrived in Portugal on Monday, accompanied by a committee of German business people. On Wednesday he will visit the Autoeuropa factory, Germany's most significant investment in Portugal. He is expected to reveal details about a new investment worth 670 million euros to be made in Palmela, where the factory is based. (1euro = 1.36 U.S. dollars)