The fight for the reform of the European Stability Pact will come to life next autumn, but for months the challengers have been issuing more or less bellicose warnings. Yesterday 11 EU countries issued a letter in which they hope to see stricter rules than those proposed by the Commission for consolidating public finances and reducing excessive debt. The captain of the hard and fair patrol is here Germany, which she joined as alwaysAustria as well as the Czech Republic, Luxembourg, Bulgaria, Denmark, Slovenia, Croatia, Lithuania, Latvia and Estonia. They are used on the opposite side Belgium, Spain, France and especially Italy The most determined is to demand more flexibility while excluding debt calculation, defense and armaments investment, green transition and digital technologies. In the middle for the time being is Holland, which is “genetically” close to the eleven penalty takers, but is more open to dialogue. The already published commission will mediate between the many participants his first reform proposal. The development of the individual states is being considered Debt Relief Plans if this is too high, with sanction procedures for non-compliance with the route. The minimum annual adjustment should be 0.5% of GDP. The penalty takers are demanding a doubling of that number. The European countries with the highest debt relative to the size of their economies are Greece (171%), Italy (144%)Spain and Portugal (113%), France (111%) and Belgium (105%). Instead, Germany remains at 68%.
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The French Minister of Finance Bruno Le Maire, argued that introducing automatic and uniform rules for debt relief would be both an economic and a political mistake. “We have already tried in the past to enforce automatic and uniform rules: leads to recessionsaid Le Maire. “Our overall goal has to be to find rules that work and make that possible timely and real debt relief and enable economic growth,” countered the German finance minister Christian Lindner Reaffirming the appropriateness of a 1% decline per year.
“In order to ensure stability, we believe it is important that sufficient attention is paid investment policy, in particular investments that have been considered a priority in Europe, especially those related to environmental and energy transition and digital. For this reason, we believe that investments that are considered priority receive special consideration special treatment. stThese are time-limited investments, the quantity of which has already been determined,” said the Economics Minister Giancarlo Giorgetti at Ecofin, the meeting of economics ministers of the European Union. “Italy and the Italian government applaud the work done, even if we believe it is the case There are still some aspects that need to be improved. Italy accepts and shares the principle of responsibility for public finances. And he behaves in exactly this way,” emphasized the minister. Giorgetti continues to play on two tableson the one hand, the reform of the Mes, the rescue fundsigned by everyone except Italy and therefore still blocked. On the other hand, the changes to the stability pact. Forgoing ratification in exchange for some concessions on public finance constraints is a dangerous game. If you take it too far, the rope could snap and Italy would be left with nothing. It is to be hoped that the minister will play this game well.