Brussels, 18/01/2005 (Agence Europe) - Tuesday's Ecofin Council had no difficulty in adopting conclusions following the conclusions formulated by the Commission towards Member States whose deficits are under surveillance. The finance ministers of the Twelve spoke out in favour of suspending excessive deficit procedures against France and Germany (EUROPE of 15 December, p.12), as well as against five new Member States (Czech Republic, Poland, Slovakia, Cyprus and Malta). Discussions on the situation of Hungary and Greece were facilitated by the fact that ministers from these two countries accepted the Commission's recommendation to continue with the procedure (EUROPE of 23 December, p.6). Speaking before the press, Commissioner Almunia stressed that the effort being made by these countries is considerable, albeit insufficient.
During the meeting, Hervé Gaymard and Hans Eichel restated when addressing their counterparts that they were resolved to keep budgetary deficit below the 3% mark in 2005 and 2006. As the Commission had stressed, the Council felt that measures taken by France and Germany are “broadly consistent” with the aim of correcting deficit in 2005 and “no further steps … are necessary at this stage”.
Also, measures taken by the Czech, Cypriot, Maltese, Polish and Slovakian authorities seem sufficient to put an end, within the time allowed, to the situation of excessive deficit in these countries, the Council points out in its conclusions.
The 25 ministers, however, noted that measures taken by Greece in 2004 were not sufficient to correct its excessive deficit. Despite these efforts and those included in the draft budget for 2005, which should allow “significant budgetary adjustment”, Greece “is not in compliance with the Article 104(7) Council recommendations issued on 5 July 2004” (EUROPE of 6 July, p.9). Given its current level (5.5%) and other budgetary risks, the “excessive deficit may persist in 2005” despite “the commitment by Greece to implement with the utmost rigour the 2005 budget”. In the longer term, the Council welcomes the Greek government's commitment to reach “the goal of a close to balance or in surplus position”. The Commission now has one month in which to adopt a new recommendation, on the basis of Article 104(9), which would consist of formal notice to Greece with new measures.
In order to achieve the deficit target of 4.6% in 2004 and 4.1% in 2005, Hungary also had to take additional measures but the Council considers the effort made is insufficient. Stressing that Hungary will miss its goals by a long way, ministers followed the Commission's assessment which predicts a deficit of 5.5% in 2004 and 5.2% in 2005. Given that Hungary has not joined the EMU, the Commission will within three months adopt a new recommendation on the basis of Article 104(7) and will suggest new measures.