The Troika has approved the seventh payment tranche of Portugal's bailout programme, Portuguese Finance Minister Vitor Gaspar confirmed on Friday.

Representatives from the International Monetary Fund (IMF), the European Commission (EC), and the European Central Bank (ECB) also gave the country an extra year to realise spending cuts worth approximately €4.0bn, equivalent to 2.5% of gross domestic product (GDP).

Portugal will now have to bring its budget deficit down to 3.0% of GDP by 2015 instead of the initial deadline of 2014.

The Troika has reduced its economic forecast for the country to a 2.3% contraction this year compared to the 1.0% that was projected last November.

"This review was difficult. Europe still lives a period of crisis," Gaspar said. "We all know how this external setting affects the Portuguese economy."

The bailout programme is still expected to end in June 2014 as scheduled.

Demands for austerity to be eased have grown in Portugal and other European countries.

LS

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