In Europe, states challenge austerity but lack cash to spend

"What has changed is that over the past year, eurozone governments have started to openly question" the wisdom of Brussels and Berlin's policy strictures, said Simon Tilford of the Centre for European Reform, a think-tank in London.

In Portugal, Finance Minister Mario Centeno, who has a PhD in Economics from Harvard University, is introducing income tax and sales tax cuts, tax rebates, new subsidies for household energy bills and restoring government workers' pay that was cut. Those steps, he says, will stimulate consumption.

Eurozone officials initially reacted with alarm at the moves, considering Portugal's debt is high at 130 percent of GDP, but after some tinkering allowed the spending plan to go through.

Nevertheless, "Portugal alone can't really do that much" to hasten a recovery, Tilford of the Centre for European Reform says. "It really needs Italy, France and Spain to put up a united front and demand fundamental change in the way the eurozone is run."