Portugal’s budget deficit falls, remains on target as bailout program nears completion

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LISBON, Portugal – Portugal’s statistics agency says the country’s budget deficit fell to 4.9 per cent of GDP last year — significantly lower than the 5.5 per cent target set by its bailout creditors.

The fall was encouraging news for the eurozone’s continuing efforts to move on from a debt crisis that rattled its 18 member countries.

Portugal’s deficit ballooned to 10.1 per cent by 2010, and it became one of four eurozone countries that needed a bailout, receiving 78 billion euros ($107.6 billion) in 2011.

In return, the bailout lenders demanded that Lisbon enact austerity measures such as pay cuts and tax hikes to reduce its debts.

Those measures have shown results, with the National Statistics Institute revealing Monday the third straight annual deficit reduction.

Portugal’s bailout program ends in mid-May.

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