Portugal looks to US for new influx of dollars
Portuguese Prime Minister Francisco Pinto Balsemao arrived in the United States Sept. 28 with a reassuring message for the US banking community and the hope of securing increased military and economic aid for this small NATO ally.
Mr. Balsemao's trip coincides with the publication of a long-delayed new Constitution that paves the way for the return of private banking. The new Constitution also puts the military under the thumb of civilians for the first time in modern Portuguese history.
During his stay in New York, where he will address the United Nations General Assembly, Mr. Balsemao will be meeting with representatives of the main American banks that have been doing business with Portugal.
His aim will be to boost investor confidence in this nation of 10 million on the edge of Western Europe. His message to the business community will be simple: Now that Portugal has a new Constitution, the government can enact long-promised changes in the country's labor and strike laws and start getting rid of lossmaking nationalized industries.
The result should be to make a West European country that still has a relatively cheap and peaceful labor force, and almost no antipollution laws, irresistibly attractive to foreign investment.
Portugal has a foreign debt of nearly $11 billion, almost all of it contracted since the 1974 revolution and much of it owed to American banks, which traditionally finance Portugal's sizable US grain purchases.
A government source said Mr. Balsemao and Foreign Minister Vasco Futscher Pereira, who was Portugal's ambassador to Washington until earlier this year, also hoped to make headway on efforts to obtain increased payment for renewing the lease on the US air base at Lajes in the Azores Islands.
The lease expires in February 1983 and, until now, Lisbon's pleas for greater US aid met with complete silence on the other side of the Atlantic.
Now that a new Constitution has been approved, which greatly increases the powers of the government and ends the military's say in politics, things appear to be moving faster.
Frank Carlucci, US deputy defense secretary, is due in Lisbon in mid-October to start the final bargaining on the new terms for Lajes - a mid-Atlantic base that is of huge strategic importance for the United States, especially in case of a European or Middle East war.
Few in the US administration know the Portuguese better than Mr. Carlucci, who was American ambassador to Lisbon at the height of the 1975 revolution.
The Portuguese government is confident that Mr. Carlucci will offer to improve on the last aid package for Lajes, under which the United States agreed to give $60 million in military aid and $80 million in economic aid.
No one has ever asked Portugal to install nuclear missiles on its soil, and no Portuguese firm is supplying equipment for the Soviet gas pipeline to Western Europe. This, Portuguese officials say, is why the comparison with the rest of NATO is unfair. Neverthless, Portugal believes it deserves a reward for an unswerving loyalty to the United States in recent years that no bigger ally can match.