Portugal’s government has announced plans to cut spending and raise revenues.

Portuguese Finance Minister Fernando Teixeira dos Santos told reporters at a news conference that spending cuts would be the focus of the plan, while tax hikes would be limited to the wealthy.

‘This is a bet on reducing the weight of the state in the economy and the weight of public spending,’ he said. ‘The plan has to be credible to restore confidence.’

The government is aiming to achieve a 2.8% budget deficit by 2013, down from 9.3% in 2009. The overall aim of the EU 27 in their Stability and Growth Pact is to limit deficits to 3%.