The Council today closed excessive deficit procedures for Italy, Latvia, Lithuania, Hungary and Romania, confirming that they have reduced their deficits below 3 per cent of GDP, the EU's reference value for government deficits.
It adopted decisions abrogating previous Council decisions on the existence of excessive deficits in these five countries.
As a consequence, 16 of the EU's 27 Member States remain subject to the excessive deficit procedure, down from 24 during a 12 month period in 2010-11. Many procedures were opened subsequent to the global financial crisis and recession of 2008 and 2009, and the EU's stability and growth pact is being used to support a return to sound fiscal positions.
Italy
The excessive deficit procedure for Italy was opened in December 2009, when the Council issued a recommendation4 on corrective measures to be taken. Italy's general government deficit was projected to reach 5.3% of GDP in 2009, above the EU's 3% of GDP reference value.
The Council called on Italy to correct its deficit by 2012. To achieve this, it called for an average annual fiscal effort of at least 0.5% of GDP over the 2011-12 period. Having peaked at 5.5% of GDP in 2009, Italy's general government deficit has been steadily brought down to reach 3.0% of GDP in 2012, in line with the deadline set by the Council.
Based on a no-policy-change assumption, the Commission's 2013 spring forecast projects deficits of 2.9% of GDP in 2013 and 2.5% of GDP in 2014, thus remaining below the 3% of GDP reference value.
The Council concludes that Italy's excessive deficit has been corrected.
See press release for EDP closures for Latvia, Lithuania, Hungary and Romania
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