EU rejects Spanish budget deficit target

Economics ministries of the EU have rejected the budget deficit target of 5.8% unilaterally announced by Spain, the EU having set a target of 4.4%, and are demanding additional cuts during 2012.

The EU wants additional cuts amounting to 0.5% of GDP, that’s an extra €5,000 million, during 2012 and are also demanding that Prime Minister Mariano Rajoy strictly enforce the mechanisms under the new law on budgetary stability to control fiscal policy at all levels of administration.

The Spanish government has reportedly expressed a willingness to consider the proposal at a later stage, probably during the next budget.

In the meantime, the German Finance Minister, Wolfgang Schäuble, has stated that Spain has already made great progress in stabilising the economy and doesn’t believe that Spain will go the same way as Greece, despite the huge budget deficit.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: