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Europe Daily Bulletin No. 8994
Contents Publication in full By article 13 / 41
GENERAL NEWS / (eu) eu/emu

Commission takes stance on Portuguese deficit

Brussels, 19/07/2005 (Agence Europe) - On Wednesday, during the last meeting of the College of Commissioners before the summer break, the Commission will take a stance on Portugal's excessive deficit situation. On 23 June, it had established a report on the basis of Article 104§3 in which it noted that Portugal's deficit, which amounted to 6.2% of GDP this year, cannot be considered as exceptional or temporary (EUROPE 8975). On Wednesday, the Commission is expected to adopt an opinion noting the existence of excessive deficit and two recommendations calling on the Council to take the same decision (104§6) and to prescribe, in Lisbon, correcting measures to return below the 3% mark of the Stability and Growth Pact (104§7). According to Portugal's stability programme, endorsed by the Ecofin Council last week (EUROPE 8989), the Portuguese authorities plan to bring down the deficit to 4.8% in 2006, to 3.9% in 2007 and finally to 2.8% in 2008. Given the size of the deficit and the existence of structural reforms in particular, the Commission is expected to give Portugal a little respite, in compliance with the more flexible times allowed by the modified Pact. Finance Ministers are to give their view on 11 October.

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