EU warns Spain and Italy over their budget plans The European Commission, the European Unions executive arm, has warned Spain and Italy that their draft budgets for 2014 may not comply with new eurozone debt and deficit rules. It also said French and Dutch plans only just passed muster. Non-complying countries may have to revise their tax and spending plans before re-submitting them to national parliaments. It is the first time the Commission has done this. Under EU rules, eurozone member states are obliged to cut deficits until they achieve a balanced budget or go into surplus. They also have to reduce public debt levels. The Commission does give countries some flexibility if their deficit is below the EU ceiling of 3% of gross domestic product (GDP) and their debt levels are falling. But when Italy, the eurozones third largest economy, asked for such leniency over its 2014 budget plans, the Commission refused because its public debt is still rising. France, whose economy shrank in the third quarter, has taken steps to cut its deficit to below the 3% threshold, but its structural reform plans were only making limited progress, the Commission said. Read more at BBC News
Posted on: Fri, 15 Nov 2013 15:30:00 +0000
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