Brussels, 03/10/2003 (Agence Europe) - Ministers of the Economy and Finance from Member States in the Euro zone will be discussing on Monday evening, under the Presidency of their Italian counterpart, Giulio Tremonti, the budgetary situation in France and Italy and will also be looking at the results of the most recent meeting between Ministers of Finance and the governors of the central banks in the G7 countries on 20 September in Dubai. The latter were committed to taking measures to strengthen economic growth.
France will present its broad guidelines for the draft 2004 budget and Commissioner Pedro Solbes is expected to outline the next stages of the excessive debt procedure (see other article). The Italian Minister will explain that the budget in his country next year intends to reduce the structural deficit from 0.3 percentage points in 2003 and 2004. It is planning for a EUR 16 bn reduction in spending, as well as specific measures for bringing the Italian deficit down to 2.2% of GDP in 2004 (as opposed to the expected 2.5% in 2003). Mr Tremonti will announce that national public debt of 106% of GDP in 2003 and 105% in 2004. Last July, Italy expected to reduce the level of its public debt to less than 100% in 2006 but postponed this objective till 2007. According to Mr Solbes, the draft Financial Law relies too much on specific measures for keeping the public deficit under wraps: in a press statement published on Thursday, the Commissioner said that "the use of specific measures is still very frequent and this involves significant risks for execution of the budget and for the future". Mr Solbes also considers that the rhythm for reducing the public debt is not ambitious enough. Even if Italy is planning for a public deficit below 3% of GDP in 2003 and 2004, Mr Solbes considers that Italy is not making enough effort to reduce its structural deficit, especially in the context of a high public debt. He is also worried that according to the government draft, reduction of the structural deficit, "will not reach the 0.5% objective of GDP defined by the Ecofin Council".