Cyprus makes deep cuts to budget amid crisis

Associated Press

NICOSIA, Cyprus (AP) — Cyprus has cut spending by 10 percent in its 2014 budget in order to meet the targets set out in the country's bailout program.

Finance Minister Harris Georgiades says the cost savings were achieved mainly by limiting ministry spending.

The 5.6 billion-euro ($7.58 billion) budget projects a primary deficit of 3.4 percent of gross domestic product next year, lower than the target of 4.25 percent.

Georgiades said after the Cabinet approved the draft budget Thursday that more cuts to the public sector wage bill and social spending will be made.

Cyprus' eurozone partners and the International Monetary Fund loaned it 10 billion ($13.5 billion) this year in a rescue deal that saw uninsured depositors take huge losses on savings in the two biggest banks.

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