Italian Prime Minister Giuseppe Conte said on his arrival at the European Council on Thursday 20 June that his government was working to present economic elements to the Commission and other Member States in order to avoid the opening of an excessive deficit procedure against his country.
"Next Wednesday, at the Council of Ministers, we will make adjustments to certify that the accounts are in a better situation than expected [...] that we are more around 2.1% [of GDP] than 2.5% [of GDP in terms of nominal deficit in 2019], as the Commission forecasts", he said.
While the Italian budgetary issue is not at the heart of the concerns of European leaders at this summit, the possible opening of an excessive deficit procedure based on debt criteria against Rome, on the basis of the report on debt under Article 126.3 TFEU tabled by the Commission earlier this month (see EUROPE 12269/1, 12275/4), is well on their minds.
This is why Mr Conte insisted, before the European Council, on reassuring his partners. This statement follows a lengthy letter sent earlier today to Member States, Donald Tusk, President of the European Council, and Jean-Claude Juncker, President of the European Commission.
In it, the Italian Head of Government first underlines his desire for changes to be undertaken in the European Union to meet the challenges it is currently facing. On the economic side, he called for "in-depth reflection on [...] how to ensure an effective balance between stability and growth, between risk reduction and sharing".
Turning to the question of compliance with his budgetary commitments, Mr Conte does not intend to ignore the rules or demand exceptions or concessions with regard to Italy. "With loyalty and conscience, we will set out our reasons which, I am convinced, will contribute, if heard without prejudice, to avoiding a Council decision on the opening of the excessive deficit procedure".
For him, the budgetary path for 2019 is in line with the rules of the preventive arm of the Stability and Growth Pact and the real figures are "much better" than those in the European Commission's forecasts (see EUROPE 12249/6). Rome would thus expect a nominal deficit of 2.1% of GDP, and not 2.5% of GDP as forecast by the Commission. Mr Conte adds that evidence will be provided by his technical teams to this effect.
Similarly, he states that measures, including tax measures, will be taken to ensure that the objective of improving the structural balance by 0.2% of GDP is achieved by 2020.
The letter also points to the lack of cooperation from some of Rome's European partners, including the maintenance of large surpluses, which would have an impact on the Italian economy.
Finally, Mr Conte argues that Italy has long maintained a surplus and higher primary balance than other euro area countries, making it one of the most responsible countries in the EU. Therefore, he does not consider it "understandable to expose Italy" to an excessive deficit procedure based on debt criteria "on the basis of a questionable assessment" by the Commission. (Original version in French by Lucas Tripoteau)