Excessive deficit procedure
The European Union is set to admonish France for breaking the bloc’s deficit and debt rules, triggering a process that can lead to onerous fines and complicating campaign priorities less than two weeks before voting starts in legislative elections.
The EU rules include strict measures for nations with debt higher than 60% of gross domestic product and a budget deficit of more than 3%.
France’s deficit was 5.5% last year, with debt at about 111% of GDP.
France isn’t alone in making the so-called excessive deficit procedure list due to be announced Wednesday. A person familiar with the matter told Bloomberg on Tuesday that it will also include Italy and another five countries.
Still, Spain and three others who breached the 3% limit escaped.
Bloomberg 19 June 2024
https://www.bloomberg.com/news/articles/2024-06-19/eu-to-slam-france-over-budget-deficit-adding-to-political-woes
Totalt är det sju länder som EU-kommissionen rekommenderar granskningar av: Frankrike, Belgien, Italien, Ungern, Malta, Polen och Slovakien.
Det blir första gången som granskningsproceduren dras igång sedan reglerna pausades i samband med pandemin för fyra år sedan.
EU:s finansministrar ska behandla budgetfrågan i juli. Därefter ska länderna lämna in åtgärdsplaner i september, som EU-kommissionen ska utreda under hösten.
DI 19 juni 2024
Euro-area members must start reducing debt immediately in the face of enormous long-term fiscal risks from ageing populations, defence spending and climate change, the European Central Bank cautioned.
“These developments will be challenging enough in isolation, and countries will face all of them simultaneously,” it said Wednesday in an article.
“Consequently, action needs to be taken today – especially in high-debt countries” grappling with elevated interest rates.
Bloomberg 19 juni 2024
Skakigt på Parisbörsen sedan president Emmanuel Macron utlyste nyval
Den finansiella marknaden är inte särskilt förtjust i osäkerheter, säger SEB:s chefsekonom Jens Magnusson.
I grunden har Frankrike även en ganska skakig ekonomi, med stora underskott och en stor statsskuld, säger Jens Magnusson.
– Därför behöver man strama åt finanspolitiken och minska underskotten. Marknaden undrar om ett politiskt splittrat Frankrike med en högerpopulistisk regering kommer klara av att göra det.
SvD/TT 20 juni 2024
France and Italy head for trouble - Ambrose Evans-Pritchard
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