The Italian senate has approved key austerity cuts aimed at convincing investors that the eurozone's third-largest economy will not be swept into the growing European debt crisis.

The measures were passed in a 161-135 senate vote on Thursday, in a vote of confidence called by Silvio Berlusconi's government.

The government fast-tracked the bills, originally scheduled for August, to soothe jittery markets. Italy's lower house will vote on Friday for final approval.

The austerity package will cut $67bn from the country's budget, and the government has announced its plans to sell stakes in state-owned companies.

Giulio Tremonti, the Italian finance minister, told the senate that the austerity package, which was strengthened by tax breaks in 2013 and 2014, seeks to balance the budget by 2014 and contains 16 measures to spur growth.

"Without the balanced budget, the monster of debt, which comes from the past, would devour our future and that of our children,'' he said.

Al Jazeera's Sonia Gallegos, reporting from Rome, said: "Italy has been more stringent on its public spending than those [other debt-ridden European] countries have been.

"It's banking system has been much more conservative than in other country's we've seen around Europe."

But despite conservative planning, Italy's debt amounts to $2.6tn, which is 118 per cent of its gross domestic product (GDP).

For comparison, Greece, which has received two bailouts, is in a debt crisis that amounts to 144 per cent of its GDP.

At the beginning of the week, stock exchange plunged to new lows while the profits of big corporations and the country's biggest banks have also suffered.

Source: Al Jazeera and agencies