Eurozone's South still poses an enormous risk

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The IMF predicts that Portugal's plans may have disastrous consequences. "The banking system's balance sheets need to be strengthened to avoid further negative surprises and protect taxpayers...A more ambitious approach to corporate debt workouts is needed."

IMF Says Portugal's Growth Constrained by Heavy Debts | Economy Watch

“External demand will accelerate in 2016, sustained by the recovery of European economies,” the government said in a statement after a cabinet meeting. It sees economic growth of 2.1 percent in 2016, more than the European Commission’s Nov. 5 forecast for a 1.7 percent expansion.

Portugal Sets Narrower 2016 Deficit Target, Sees Faster Growth - Bloomberg Business

Earlier this week, Spanish newspaper El Pais reported that Portugal's largest bank, Caixa Geral de Depósitos (CGD), an institution that holds nearly one-third of all deposits in the country, is on the brink of destruction following a horrendous first quarter of the year. The bank is thought to need a cash injection of as much as €4 billion (£3.04 billion, $4.45 billion) to rescue it from serious difficulties. That number amounts to roughly 2.5% of Portugal's GDP.

HSBC analysis: Portuguese economy and banking sector - Business Insider