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Lisbon: Portugal gets top marks for effort— Lisbon

Preface

Portugal has narrowly escaped danger with its recent successful bond auction. Putting aside the still precarious, publicly scrutinised financial situation, the harrowed country is also proving it can at least do some things right.

Bond, Economy auction

16 January 2011

Portugal has narrowly escaped danger with its recent successful bond auction. Putting aside the still precarious, publicly scrutinised financial situation, the harrowed country is also proving it can at least do some things right. Results published by the OECD last month showed that 15-year-olds in the country made the biggest overall improvement in reading, mathematics and scientific skills compared with students from other developed countries between 2006 and 2009.

In the past, the survey, based on tests taken by around half a million teenagers in more than 70 countries, usually saw Portugal’s average parked at the bottom of the league table – but it has now grabbed a seat just beneath the UK and Denmark.

“What surprises me most is that someone has finally said to our country, ‘you’re doing well’,” said Prime Minister José Sócrates. The news comes at a time when his government – at serious risk of being hounded out if the IMF does end up pitching in – is trying to show that its reforms has made, and will make, the economy more competitive.

Poor performances in previous tests had led to “a common view that too many Portuguese students lacked the knowledge and skills needed in a modern economy,” according to the OECD. But now it has been praised for providing more subsidies for laptops, meals, books, broadband access, and extra-curricular activities to disadvantaged students. Given its poor functional literacy rate – the lowest in Europe – Portugal’s investment in youth during tough times is commendable.

The next hurdle, however, is to keep this young talent within its borders by the time they reach working age. “Graduates are leaving because there are no jobs here,” says Catarina Rosendo, a PhD student at the Universidade Nova de Lisboa. “There are several successful examples of university R&D units developing partnerships with the corporate world, but not much else.”

Experts are worried about the new wave of emigration, caused by a sluggish economy and a shrinking private sector. It is the largest since the pre-revolution exodus in the 1960s. A 2006 World Bank report warned that the brain drain meant 13 per cent of graduates were leaving, mainly to the UK or Spain, and that figure is expected to be much higher in 2011.

“We have now the highest youth unemployment of the last few decades,” says Alvaro Santos Pereira, Portuguese economist and professor at Vancouver’s Simon Fraser University. “The government needs to incentivise the most innovative sectors of the economy, so that entrepreneurship is increased and opportunities are created. “If we start giving a higher priority to the private sector, there will be more opportunities for the young and many of the expats will be more tempted to come back.” As the new generation of rising stars looks to the future, the government must work to ensure that future can belong in Portugal.

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