Portugal isn't far behind Ireland when it comes to debt problems

U.S. President Barack Obama arrives on the first day of the NATO Summit at Feira Internacional de Lisboa (FIL) on November 19, 2010 in Lisbon, Portugal. The two day summit will address issues including a new strategic concept for NATO. Britain and the US will also seek an agreement to hand over responsibility for security in Afghanistan to local forces over the next four years.


STEVE CHIOTAKIS: In Germany today, the Federal Reserve Chairman Ben Bernanke defended to his European critics the Fed's latest round of pumping money into the economy. Some global economic leaders question the
Fed's monetary policy, saying the move manipulates the dollar, giving the U.S. an unfair economic advantage.

Meanwhile, President Obama landed in Portugal today. He's there for a scheduled NATO meeting on military matters, but the economy will top the agenda. Investors say Portugal isn't far behind Ireland when it comes to debt problems.

From Lisbon, the BBC's Alison Roberts reports.

: Just as Irish leaders insist they don't need a bailout, Portugal's government says it will make the tough decisions needed to avoid crisis. It continues to struggle to bring public spending under control. The state budget for 2011 includes public sector salary cuts and tax increases in a bid to half the deficit.

Secretary of State Hillary Clinton told Portugal's foreign minister this morning she understands that Portugal is balancing its military and budgetary priorities.

HILLARY CLINTON: Although we are very supportive of the difficult decisions that will have to be made concerning the economy, we believe that the mission we are pursuing in Afghanistan must continue.

Clinton said Lisbon's 100 or so troops in Afghanistan remain "vital" -- and the Portuguese Prime Minister says he's willing to boost its contribution in future, in the form of training for local forces.

In Lisbon, I'm the BBC's Alison Roberts for Marketplace


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