Stability and convergence programmes + country-specific budgetary surveillance: extracts from the press conference by Joaquin ALMUNIA, European Commissioner for Economic and Monetary Affairs
Première transmission: 24/03/2009
Strasbourg, France - EP
Fin de production: 24/03/2009
Following the assessment of their Stability and Convergence Programmes, the EC proposed deadlines for the correction of the budget deficits of Greece, Spain, France and Ireland that were already above 3% in 2008.
The EC also proposed a new deadline for the correction of the excessive deficit in the UK. The deadlines proposed take account of the respective fiscal and macro-economic situations of the countries concerned. Once the recommendations have been adopted by the Council, the five countries will have six months to specify what measures they intend to take to progressively reduce the deficit.
The Commission also examined the updated Stability Programme of Cyprus and found that the fiscal policy in 2009 will be rather expansionary. This should be reversed in the following years in view of the large external imbalances.
Only the original language version is authentic and it prevails in the event of its differing from the translated versions.
||SOUNDBITE (English) by Joaquín Almunia, Member of the EC in charge of Economic and Monetary Affairs: In 2008, these four countries namely France, Greece, Ireland and Spain had a deficit above 3% and according to our interim forecast in January this deficit above the reference value will remain in 2009 and 2010; in these circumstances, we need to launch an excessive deficit procedure.
||SOUNDBITE (English) by Joaquín Almunia: We continue to be convinced that fiscal stimulus is needed this year, according to our recovery plan, and in particular two of these for Member States – France and Spain - have decided to give to their economies a fiscal stimulus and we agreed with this approach for 2009; we are not asking them to start correcting the excessive deficit this year; this is not the case for Ireland and Greece, that we consider that Greece and Ireland have no fiscal space to adopt the fiscal stimulus this year, they need to start correcting the excessive deficit this year; both governments by the way have adopted or announced measures to start this correction this year.
||SOUNDBITE (English) by Joaquín Almunia: We have adopted a recommendation with a new deadline for the correction of the UK excessive deficit; we consider that the UK is also suffering a difficult slowdown so we need to adjust the path for the correction for the excessive deficit that was defined in the excessive deficit procedure adopted for the UK in the past; taking into account the new economic scenario and the more difficult economic environment, we are asking the UK authorities to correct the excessive deficit in the fiscal exercise 2013-2014.
||SOUNDBITE (English) by Joaquín Almunia: We are recommending to Cyprus not to loosen its budgetary policy more than they have adopted, or the stimulus they adopted for this year; we think that starting from the present situation of the public finances, they should commit to reverse the expansionary of the fiscal policy as soon as possible, given the impact of the ageing of the population in the sustainability of the Cyprus public finances over the medium- to long-term.