Spain and Portugal will not have to face fines for exceeding the deficit limit under the rules of the European Union (EU), announced the representation of the member countries of the bloc in Brussels today.
the European Commission recommended on 27 July not to sanction these two countries and give two more years to Spain until 2018 to bring its deficit below three percent of gross domestic product (GDP) as establishes the stability and growth pact EU.
Unless a qualified majority of finance ministers of the bloc veto this decision until Monday, was automatically approved, which finally happened now.
the case generated controversy within the EU, torn between the importance of sanction to confer credibility to the rules but ensure both that the measures do not harm the weak economic recovery in the bloc, which already If you suffered a blow with the decision of the United Kingdom to abandon it.
In its report of 27 July, the EU executive also decided to take two more years to Spain to reduce its public deficit . Under the new measures must be placed this year at 4.6 percent of GDP, at 3.1 percent in 2017 and 2.2 percent in 2018. Portugal has to bring its deficit at 2.5 per percent this year.
in theory, the two countries could have been punished with a fine equivalent to 0.2 percent of gross domestic product (GDP), a figure that in the case of Spain amounted about 2,000 million euros (2,200 million dollars) and Portugal to almost 200 million euros.
However, the Commission proposed to rescind this measure not to increase the anti-European sentiment in these two countries and in recognition of the efforts that have been made.
in its recommendation, the Commission said it recognized “the challenge of the economic environment, efforts to make reforms in both countries and their commitment to comply (with rules EU) “.
Both countries have yet to take effective measures to reduce overspending until October 15 and report actions. If they do not meet the requirements, there remains the possibility that they cancel payments of structural funds, EU aid. This option will be analyzed by the Commission around the holidays (boreal).
The Vice President of the Commission, Valdis Dombrovskis, responsible for the euro, welcomed the ministers’ decision to cancel the fines but stressed that Spain and Portugal will have to take “effective action” as a condition that they will not cut the structural funds.
the Commissioner for Economic and Financial Affairs, Pierre Moscovici, said the decision “reflects an intelligent application the stability and growth pact “. Give more time to Spain and Portugal to put their deficits in order strengthen both their economies and the euro zone, he said
2015 Spain had a deficit of 5.1 percent of GDP., Despite to have committed to 4.2 percent. Meanwhile, in Portugal the deficit was 4.4 percent in 2015, exceeding the 2.5 percent agreed with the Commission.
The infringement procedure was initiated on July 5 after finding ” lack of effective action “by both countries.
Spain meets a caretaker government since December, after the elections because there was no majority to form a new government. The elections were repeated on June 26, but for now has not achieved any coalition that is put in front of the country, so the conservative Mariano Rajoy continues on an interim basis.
Since the introduction of euro in 1999. Germany has failed seven times the deficit limit in 2001 (3.1%), 2002 (3.8) 2003 (4.2) 2004 (3.8) 2005 (3.3), 2009 (3.1) and 2010 (4.2). France is currently also with an open procedure by this issue.
No comments:
Post a Comment