Despite denials by the Portuguese Prime Minister Jose Socrates that the country will not be seeking financial aid from the IMF or the European Union, technical discussions are being held ‘quietly’ among European leaders about a possible bailout plan, the Portuguese newspaper Publico reported on its Web site.
The plan includes a suggested bailout of between 60 billion euros ($78 billion) and 100 billion euros, the paper said.
“The issue is not formally on the agenda, but will most certainly be discussed,” a European diplomat told Publico, which wrote that another diplomat confirmed the information.
Both confirmed that Portugal will the focus of the discussions between European finance ministers next week at the Euro Stability meeting.
Earlier on Tuesday, Portuguese Prime Minister Jose Socrates said his country does not need a bailout and that talk on whether it will ask for aid only encourages speculators.
On Wednesday, Portugal will face the test of the markets as it will try to sell up to 1.25 billion euros worth of bonds, maturing in October 2014 and June 2020.