The Spanish government yesterday approved its 1999 budget , aiming to slim its public deficit more than initially planned despite forecasting slightly slower economic growth next year.

Economy Secretary Mr Rodrigo Rato told a news conference after the weekly cabinet meeting that Spain's gross domestic product was expected to grow 3.8 per cent next year, above the 3.7 per cent projected for 1998 but below the initial forecast of 3.9 per cent for 1999. The lower forecast confirmed expectations that the global economic crises will put a brake on expansion in Spain.

Despite the revision, Mr Rato said Spain was counting on one of the strongest economic performances in Europe to cut the public administration's deficit to 1.6 per cent of GDP in 1999, versus a downward revised 2.1 per cent this year.