European Commission Günther Oettinger had earlier signaled his intention to get tough, suggesting inaction on the matter was not an…
European Commission Günther Oettinger had earlier signaled his intention to get tough, suggesting inaction on the matter was not an option. He fears there will be an uprising from eurozone members if Brussels does not take a stand. Italy’s ruling coalition, a partnership between Matteo Salvini’s Lega and Luigi Di Maio’s Five Star Movement has defied Eurocrats with a budget representing a spending of 2.4 percent of GDP next year.
Deputy Prime Minister Salvini, speaking after Brussels rejected Italy’s 2019 budget, said on Wednesday the government’s fiscal targets were valid and indicated he would not negotiate about them.
He told reporters: “We are convinced about the numbers in our budget. We will talk about it in a year’s time. “
The EU executive on Wednesday took the first step towards disciplining Italy over the budget, backed by eurozone governments worried that Rome’s borrowing and spending plans could trigger another debt crisis that would hurt them all.
Mr Salvini said any EU sanctions against Rome would be “disrespectful” towards Italians.
Italy budget: Matteo Salvini is on a collision course with the EU
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Italy budget: Matteo Salvini is on a collision course with the EU ] If we do nothing at all Wednesday, it will certainly not contribute to progress
The figure would equate to just over € 44billion, which Brussels fears will simply push the country’s € 2.5trillion national debt – which represents 131 percent of the country’s GDP – still higher.
The European Commission, which rejected the budget plans in October, today published its views on the draft of all the 19 countries sharing the euro, including that of Italy’s eurosceptic government. Wording has been revised only slightly since then – and nothing like enough to satisfy Mr. Oettinger.
Earlier he told Politico: “If we do nothing at all Wednesday, it will certainly not contribute to progress.
” Then the Balts, the Dutch, the Danes – even some Germans – will
The so-called 126 (3) report says Italy is at serious risk of non-compliance with the EU’s debt rules, according to Politico.
The report will single out Italy as being in breach of the EU law, which states that public debt can not be higher than 60 percent of GDP, or if it is, has to fall to 60 percent at a satisfactory rate.
After today, Member States will then have a fortnight om at undersøge dette dokument, og hvis de er enige med sine resultater, ville Kommissionen have bemyndigelse til at indlede en uforholdsmæssig defunct procedure, som kunne føre til eventuelt frysning af EU-kontanter.
The European Council, consisting of de italienske regeringskommissionerne skulle så måtte underskrive sådanne tiltag, med Italien at få mellem tre og seks måneder til at tage handling.
Italien siger ekspansive tiltag og store offentlige udgifter er nødvendige
Economy Minister Giovanni Tria says France – whose national debt represents 97 percent of its GDP – has been given greater leeway than Italy on its budget in recent years s, and has pointed out that Italy’s primary balance, excluding debt-service costs, has been in excess for almost 20 years.
Italy’s leaders have adopted a bullish attitude in the face of the criticism of their budget plans. 19659003] Speaking last month, Mr. Salvini said: “If we are polite, we open the little letters from Brussels, we read them, we respond to them.”
“They write back and
Mr Salvini’s coalition partner Luigi Di Maio believes voters will punish Brussels in May
“If Brussels or some big professors want Italy at zero growth, they have run into the wrong go defense and the wrong minister. “
Speaking this morning, Mr. Salvini reiterated his position, saying he was open to dialogue about investments ” but not on the budget deficit or pension reform, “
Earlier this week, Mr Di Maio claimed voters in May’s European Parliamentary elections throughout Europe would opt to punish Brussels.
He said: “Citizens will vote in the European elections and will cause a big shake up.
“We are ready to discuss things around a table, but they can not ask us to massacre Italians.”
Italy’s Prime Minister Giuseppe Conte will have dinner with European Commissioner Jean-Claude Juncker on Sunday , at which the subject will doubtless crop up.
Speaking in response to the news of the budget’s rejection, Hinesh Patel, portfolio manager at Quilter Investors, the multi-asset investment manager, said: “In some respects this is a win for the populi sts, who will use this decision to fuel criticism of the EU policy makers they cast as the enemy of the Italian electorate. Men Italien er at risikere at skille sig fra økonomiske realiteter, hvis det presses på trods af denne ruling fra European Commission.
“Den øjeblikkelige reaktion fra markeder tyder på at afstemning er forventet. Selvom italienske obligationsrenter har været stigende for flere måneder, et klart signal om at bondmarkets tillid i Italien er fragile. Resultatet er at regeringens evne til at låne nedskæringer og det kredit, de kan få, kommer til en højere pris. “Dette er en afgørende faktor, når du anser at det bumperbudget, der er beregnet til at stimulere økonomien, vil kræve øget offentlig låntagning.
” På trods af den nervøsitet denne stand-off kan forårsage i finansielle markeder, er det værd at huske, at Europa-Kommissionen har disse control and governance capabilities over member states for a reason. At the height of the European sovereign debt crisis 24 countries were under excessive deficit procedures, a burden which France, for example, has only been able to shake off. Selv om det er en overraskelse at vi har nått dette dødsfall, er EU-kommisjonen i sidste ende bare lever på sin mandat. “