Portugal shows zeal of austerity, refer to high-speed rail (AFP)

Lisbon (AFP) - the new centre-right of the Portugal Government promised Tuesday to go beyond the objectives of austerity agreed in its EU - IMF rescue plan, sacrificing the completion of a high speed train linking with the Spain.

Suspend the construction of the rail link Lisbon-Madrid high speed that was scheduled to be completed by 2013, as part of a four year program Government submitted to Parliament for approval.

The Portuguese Prime Minister Pedro Passos Coelho promised Government of "scrupulously apply the measures negotiated with the Monetary Fund International and the European Union," but said he wants to be "more ambitious in the process of adjustment to the Portuguese economy.

This was to "guard against external and internal potential," said a Government document detailing the plan.

Bailout Lisbon, Portugal ($112 billion) of EUR 78 billion to implement stringent financial control measures, to introduce reforms and sell property of the State to improve the weak structure of the economy.

The country must press its public deficit of 9.1% of the domestic product gross year last three percent in 2013.

There were growing concerns that a Greek default could spread a new wave of contagion throughout the euro area, further damage weaker economies such as the Portugal.

"Complementary measures of a structural nature" will be adopted if necessary "to ensure respect and achievement targets early which is linked to the country and restore international confidence in its economy, also" promised in the Government.

The Government program, due to be debated by legislators, on Thursday and Friday, announced it would "suspend" construction of the high-speed rail project.

This could be revisited at a later stage, for a possible renegotiation of the contract, the document said.

The contract for the first section of the line of Madrid was signed in May 2010, while the process of tendering for a second section was never completed.

The project was to reduce the travel time between the two capitals within three hours and bind the Portugal to the railway network at high speed in Europe, at a cost of EUR 3.3 billion to Lisbon.

The Minister of transport of the Spain, Madrid, Jose Blanco, said that if the suspension is approved, it would be "a bad decision" while adding that he also wanted clarification if it would be a temporary or permanent stay in the project.

The rail link was a flagship project of former Socialist Prime Minister José Socrates, but the centre-right long called for him to be delayed to reduce the debt of the country, reaching 93% of GDP in the last year.

The new Government also pledged to reconsider the construction of a new airport for Lisbon, which was to be completed by 2017.

It is committed to expanding the privatization of media held the State to include the sale of a string of television, radio and press agency Lusa.

The Government also promised reforms of the labour market to eliminate all fixed-term employment contracts by simplifying the regulations for employers to put an end to new recruits.

It is committed to implement existing laws and to create an independent authority to monitor expenditures.