Austerity measures already announced have caused widespread protests Portugal will sink into recession this year and next due to the terms of its 78bn euro ($116bn; £70bn) rescue deal, its finance minister has said.
Fernando Teixeira dos Santos said austerity measures required as a condition of the funds would see the economy shrink by 2% in 2011 and 2012.
He said Portugal would be forced into further tax rises and spending cuts.
His comments came ahead of a press conference on Wednesday to outline further details of the rescue.
The conference is being held in Lisbon by officials from the European Union and International Fund Monetary, which is providing the bail-out money.
Mr dos Santos said the planned economic restructuring would be tough, but added: “This is a programme aimed at returning to growth and employment.”
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