EU targets 7 member states for excessive public deficits, reinstates budget rules
Date
7/29/2024 4:15:55 AM
(MENAFN) The European Union has formally initiated measures against seven member states, including France, for excessive public deficits, marking the first enforcement of such actions since the suspension of budget rules in 2020 due to the coronavirus crisis. The affected countries are France, Italy, Belgium, Hungary, Poland, Slovakia, and Malta. Romania, which has been under these measures since 2019, continues to face sanctions for failing to effectively address its budget deficit, according to a statement from the Council of the European Union, the body representing EU countries.
Over the past year, these nations have surpassed the public deficit limit of 3 percent of GDP as stipulated by the Stability Pact, which also sets a debt threshold of 60 percent of GDP. As a result, these countries are required to implement corrective measures to comply with the budgetary rules in the future or face financial penalties. The budget rules, initially suspended due to the economic impact of the COVID-19 pandemic and the war in Ukraine, were reinstated this year.
In 2022, Italy recorded the highest deficit in the EU at 7.4 percent of GDP, followed by Hungary at 6.7 percent, Romania at 6.6 percent, France at 5.5 percent, and Poland at 5.1 percent. These figures reflect significant deviations from the EU's budgetary norms, prompting the reactivation of stringent fiscal oversight to ensure economic stability across the union. The enforcement of these measures underscores the EU's commitment to maintaining fiscal discipline among its member states in the wake of unprecedented economic challenges.
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