Portugal can expect a recession of 2.8 percent next year – its worst in three decades.
It is just one of the figures finance minister Vitor Gaspar revealed as he presented budget proposals for 2012.
They include a new austerity package designed to prevent Portugal becoming the next Greece.
Lawmakers are expected to approve the budget in a vote at the end of the month.
The two main Portuguese trade union confederations, CGTP and UGT, plan a general strike against the austerity measures on Wednesday.
The last general strike in Portugal was in November 2010.
Around 40,000 people demonstrated on Saturday night in Lisbon and Porto as part of worldwide protest against the excesses of the financial system.