Summary Recent statements by French and Portuguese officials signal that the governments of EU members are willing to push for a relaxation of their deficit targets and ignore agreements with Brussels, even after some of them already received softer targets this year. The European Union is likely to give in once more to stave off social unrest and also because of its inability to apply effective penalties. This will hurt the European Union's already-weak credibility, limiting its ability to operate as a cohesive bloc. Analysis Lisbon will ask the European Union and the International Monetary Fund to relax Portugal's 2014 budget deficit goal to 4.5 percent of gross domestic product from 4 percent, Portuguese Deputy Prime Minister Paulo Portas said Sept. 11. The same day, Economy Minister Antonio Pires de Lima said that the country would not achieve enduring economic growth if taxation remains at current levels. Portugal's deficit targets were already relaxed in Ma...
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