Luxembourg, 05/06/2007 (Agence Europe) - By putting an end to the excessive deficit procedures on Tuesday, against Germany, Greece and Malta, the Ecofin Council, as expected, followed the recommendations from the Commission (EUROPE 9428). With a variety of deadlines, seven member states (Italy, Portugal, Czech Republic, Hungary, Poland, Slovakia and the United Kingdom) are still affected by excessive deficit procedures and Romania will be joining them soon (EUROPE 9421).
Bringing its budgetary deficit down from 3.2% in 2005 to 1.7% in 2006, Germany has managed to leave this procedure, to which it has been subject since January 2003, behind a year earlier before the deadline expired. The German finance minister, Peer Steinbrück, declared that according to the Commission's forecasts, “We are both supportive of and obliged to reach a balanced budget by 2010”. The Commission's forecasts had stipulated that the deficit should already be reduced to 0.6% in 2007 and to 0.3% in 2008.
Begun in May 2004, the procedure against Greece was also shortened following realistic and sustainable corrections to the budget. The budget was brought down from 5.5% in 2005 to 2.6% o, 2006 and is expected to reach 2.4% this year. The Council pointed out that although the debt, which fell from 108.5% of GDP in 2004 to 104.5% in 2006 is still well above the reference value, it is expected to follow its downward trajectory to the reduced figure of 97.5% in 2008.
Urged to return to below 3% by the end of 2006, Malta has brought its deficit down to 2.6% (as opposed to 10% in 2003 and 3.1% in 2005) and is expected to maintain this rate in 2007 (2.1%) and o, 2008 (1.6%). With the abrogation of the excessive debt procedure, which was opened when the country joined the EU in 2004, Malta is now respecting all the criteria for its entry into the Euro zone.
This accession, like that for Cyprus, was “unanimously” approved by the Ecofin Council, declared Joaquin Almunia. Now that the two candidates have achieved a high degree of convergence (EUROPE 9428), the European Council is expected to make their accession official on 21-22 June for joining on 1 January 2008. It will then be up to finance ministers at the July Ecofin to take a decision on establishing fixed and irrevocable conversion rates for the national currency and the Euro. (ab)