Italian Prime Minister Silvio Berlusconi leads a news conference at Chigi palace in Rome Reuters

In Rome, the Italian government presented a new austerity bill meant to save the country 47 billion euros ($65 billion) by 2014.

The package includes a number of budget cuts and tax changes that will be voted on by parliament.

The composition of the budget is very well balanced between lower spending and higher revenues, Economy Minister Giulio Tremonti said at a news conference Thursday.

With today's measures we completed our path towards a balanced budget.

Italy is the Eurozone's third largest economy, trailing Germany and France, but its debt is currently 120 percent of its gross domestic product. Facing a credit downgrade from Moody's and Standard & Poor's, Italy hopes the budget initiative will reassure its European counterparts that its on the right track, financially.

Reducing the budget deficit is not just about numbers, it is a political and ethical objective of a country, Tremonti added. It is reflected in choices of responsibilities between citizens and generations.

The cuts won't take effect until 2013, long enough away that Prime Minister Silvio Berlusconi's government mandate will have expired.

In Italy, 2013 is an election year, and many critics feel that the cabinet is trying to pass off unpopular initiatives. Most of the austerity measures will expire in 2014.

The package includes an extension of a public employee wage-increases freeze, increased medical fees and a reduction in extraneous governmental expenditures. The bill will propose lowering the national income tax in exchange for cancelling certain tax credits.

Italy's debt-to-GDP ratio is among the worst in Europe, and is vulnerable to a similar crisis as the one in Greece, although arguably it is not as vulnerable as Spain, Portugal or Ireland, who have larger private debt.