Cyprus passes 2014 budget, 1st after agreeing to financial rescue deal

NICOSIA, Cyprus – Cyprus' parliament has approved the 2014 state budget, the country's first after agreeing to a painful rescue deal earlier this year that saved it from bankruptcy.

The budget incorporates deep spending cuts to meet strict fiscal targets set by Cyprus' euro area partners and the International Monetary Fund following a government promise to avoid new taxes.

Thursday's vote in the 56-seat parliament had 30 lawmakers voting in favor and 20 against. Four lawmakers abstained.

Cyprus received a 10 billion euro ($13.67 billion) loan after seizing large portions of uninsured deposits from its two largest banks.

The government said the danger of meltdown has receded, but a tough year still lies ahead with the economy projected to contract by 4.8 percent of gross domestic product. Unemployment will peak above 19 percent.