Portugal's former minister warns of bleak financial situation

Portugal's economy will suffer if the government maintains its current macroeconomic policy, the country's former finance minister, Maria Luis Albuquerque, warned on Tuesday.

A new bailout will be needed if the government doesn't take action soon, she said at a conference at a summer university course in Castelo de Vide, around 220 km north of Lisbon, according to Portuguese Lusa News Agency.

The economic policies being undertaken by Prime Minister Antonio Costa, which focus on internal consumption, "was tested in the past and it led to a financial crisis and a bailout request," she said.

"Today we look at the national press, to research by banks, to reports by financial agencies and we have a sense of deja vu which is worrying, with a rise in interest rates, recurrent warnings about the path that is being followed and risks the country faces," she said.

Albuquerque also pointed to doubts investors had surrounding the country's public debt targets, and said wealth should be distributed more evenly.

Portugal signed a 78-billion-euro (86 billion U.S. dollar) bailout program when it was on the verge of bankruptcy in 2011.

The country applied harsh austerity measures to boost growth especially before ending the program in 2014, however public debt is still at 130 percent of GDP, and last year the country missed its deficit target of 2.7 percent, above the EU ceiling of 3 percent.

Costa, who vowed to "turn a page on austerity," said he planned to cut the deficit next year to 1.4 percent. Endit