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Portugal budget deficit falls to 4.9%

31 March 2014 18:06 (UTC +04:00)

Baku-APA. Portugal's budget deficit is below previous figures estimated by the government, the country's National Institute of Statistics (INE) revealed on Monday, APA reports quoting Xinhua.

Portugal ended 2013 with a budget deficit of 4.9 percent of gross domestic product, according to the INE, while Portugal's public debt has risen to 129 percent.

The government had agreed a deficit of 5.5 percent with the troika comprising the European Commission, the International Monetary Fund and the European Central Bank last year, higher than its target of 4.5 percent in 2012.

The figures come as the Portuguese government discusses its budgetary strategy, which will include austerity measures for 2015.

The government not only has to find where to make further cuts but also how to make temporary cuts, now worth 2.15 million euros (2.96 million U.S. dollars), and needs to prove to both the troika and investors that it's capable of achieving financial sovereignty.

Portugal is just two months away from ending the bailout program it signed in May 2011 with the troika.

The country has pulled out of its worst recession in three decades, the growth of the economy in the fourth quarter was the fastest in the eurozone and in January unemployment fell down to 15.3 percent from 17. 6 percent during the same period last year.

Last month, the country raised 3 billion euros in 10-year bonds, 80 percent of them acquired by foreign investors.

However, rating agencies still classify Portugal's bonds as junk and its public debt is still too high, reaching 129 percent of its GDP.

The government is still considering the possibility of a precautionary credit line to keep the country afloat after it ends the bailout program.