EU delays action against German budget deficit

1st February 2006, Comments 0 comments

1 February 2006, BRUSSELS — European Union finance chiefs will probably decide on action against Germany's excessive budget deficit in April or May, later than originally foreseen, EU monetary affairs chief Joaquin Almunia said Wednesday.

1 February 2006

BRUSSELS — European Union finance chiefs will probably decide on action against Germany's excessive budget deficit in April or May, later than originally foreseen, EU monetary affairs chief Joaquin Almunia said Wednesday.

Almunia told reporters he expected Berlin to adopt a new financial programme on February 22 and then submit it to Brussels.

After that, "I have to look at the programme and will do my job seriously and rigorously," Almunia said.

The Commission's assessment will then be forwarded to EU finance ministers in either April or May, he said.

The Commission — which polices eurozone economies — had earlier said it would rule on Germany's high budget deficit in February.

EU rules demand that eurozone governments limit their budget deficits to a maximum three percent of Gross Domestic Product (GDP). Germany — as well as France, Italy and others in 12-nation currency bloc — have been in breach of the ceiling for several years running.

Almunia said last week that the Commission would be pragmatic in tackling Germany's ballooning budget deficit given the new coalition government's determination to rein in budgetary expenditure.

But he also warned that Brussels was determined to correctly apply EU fiscal rules to the largest eurozone economy.

Almunia said he would steer clear of any moves which would "jeopardize economic recovery in Germany."

DPA

Subject: German news

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