Portugal: Will strip €1.4bn from 2015 budget

Portugal on Tuesday laid out savings designed to strip 1.4 billion euros ($1.9 billion) from its budget in the latest step to trim its public deficit.The new measures, adopted as part of Lisbon's 2015 budget, come as the country battles to reduce its budget deficit to 2.5 percent of economic output.A spokesman for Finance Minister Maria Luis Albuquerque said most of the savings would come from cutting government costs "without demanding more sacrifices" from ordinary peoplePortugal, still struggling to overcome its debt crisis, recession and public anger at tough austerity measures, posted a public deficit of 4.9 percent of output last year.That marked a huge reduction from 6.4 percent in 2012.But despite this marked progress, the public debt of accumulated past deficits rose to 129.0 percent of output last year, up from 124.1 percent in 2012.Portugal was forced to seek a bailout in 2011 after decades of ballooning wages and state spending had led to a massive build-up of public debt.The three-year aid programme worth 78 billion euros from the EU and IMF, which demanded deep structural reforms to correct public finances and improve economic efficiency, is due to end next month.The IMF had demanded that Portugal published new cost-cutting measures on Tuesday before it would give a green light to its 900 million euros slice of 2.5 billion euros of credit due to be released this week.