EU's deficit action on German budget on hold

8th September 2006, Comments 0 comments

8 September 2006, HELSINKI - The European Union is set to put its planned excessive deficit action against the German budget on hold, Eurogroup chairman and Luxembourg's Premier Jean-Claude Juncker said Friday.

8 September 2006

HELSINKI - The European Union is set to put its planned excessive deficit action against the German budget on hold, Eurogroup chairman and Luxembourg's Premier Jean-Claude Juncker said Friday.

Asked if EU measures against Berlin were being put in abeyance, Juncker told reporters, "There is no reason to accelerate the procedure and no reasons to continue."

Juncker's comments reflect growing EU satisfaction at Berlin's efforts to put its financial house in order.

EU officials in Brussels earlier this week welcomed German Finance Minister Peer Steinbrueck's statement that the German budget deficit would stand at 2.8 percent of gross domestic product (GDP) this year - meeting eurozone demands that deficits should be under three percent of GDP.

Germany has been in the EU firing line for several years for having allowed its budget deficit to overshoot the three-percent-of-GDP ceiling.

Other key eurozone countries, including France and Italy, have also received EU reprimands for not respecting the bloc's fiscal rules.

Excessive deficit action by the EU carries the risk of countries being slapped with hefty fines for failing to meet eurozone standards.

DPA

Subject: German news

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