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    Commission calls for freeze of budget deficit rules

    Credit: Belga

    New procedures against member states with excessive deficits should not be started, the European Commission recommended to the EU Council on Wednesday.

    The Commission made this recommendation “in light of the exceptional uncertainty related to the extraordinary macroeconomic and fiscal impact of the pandemic.”

    Six countries including Belgium were under particular surveillance for their public debt in 2019.

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    While rules on budgetary discipline – requiring a government deficit of less than 3% of GDP and a government debt of less than 60%, or sufficiently diminishing – were suspended in March due to the new coronavirus (Covid-19) crisis, the Commission must still prepare reports for those Member States planning to exceed a 3% deficit in 2020 because of the coronavirus.

    For France, Belgium, Cyprus, Greece, Italy and Spain, these reports also assess compliance with the debt criterion in 2019, based on Eurostat data, and take into account the negative impact of the coronavirus pandemic on national public finances.

    The Brussels Times