Malta is one of the 11 Eurozone countries which are not at risk of breaking the European Union’s deficit rules in 2018, according to the European Commission.
The national budgets of six Eurozone countries may break the European Union’s budget deficit rules next year, the European Commission said on Wednesday, with Italy, France and Belgium also failing to cut public debt in line with EU requirements.
The Commission analysed draft 2018 budget plans of all the Eurozone countries except Greece, which is under a bailout programme, to check if their main assumptions are in line with EU rules that set limits on budget deficits and public debt.
It said that Germany, Lithuania, Latvia, Luxembourg, Finland the Netherlands as well as Estonia, Ireland, Cyprus, Malta, and Slovakia were either fully or broadly compliant with the rules, called the Stability and Growth Pact (SGP).
“For Belgium, Italy, Austria, Portugal and Slovenia, the Draft Budgetary Plans (DBP) pose a risk of noncompliance with the requirements for 2018 under the SGP,” the Commission said, adding that France was also in the same group.
The rules say that EU countries should have budget deficits below 3 percent of GDP and public debt below 60 per cent of GDP. They should also seek to reach budget balance or surplus in structural terms — which exclude business cycle swings and one-off spending and revenue — and cut debt each year to bring it below the 60 per cent threshold if it is higher.
Malta managed to lower its debt to below the 60 per cent threshold in 2016, and registered a budget surplus this year.
The Commission said it recommended a broadly neutral fiscal stance for the euro zone of 19 countries as a whole. “This should contribute to supporting investment and improving the quality and composition of public finances. In line with the Commission’s priorities, member states are also asked to step up their efforts to implement measures to fight aggressive tax planning,” the Commission said.