European Commission president Romano Prodi has described the EU's stability and growth pact as "stupid" because it fails to allow enough flexibility. The surprise comments were made in an interview appearing in Le Monde. Prodi said that although it would be desirable to have a system that was both more flexible and intelligent, that a lack of EU authority made such a move difficult.
"It's clear that nobody has the (necessary) authority. That's the problem," he said. He also said it was not possible to have a "flourishing Europe with strong growth without being able to adjust decisions according to the moment. I know perfectly well that the stability pact is stupid, like all decisions that are rigid." However, he added, "If one wants to adjust (the pact) we would need unanimity, and that won't happen."
Prodi's remarks set him against European Economic and Monetary Affairs Commissioner Pedro Solbes, who last night issued a statement warning Germany that it would face a formal procedure if its public deficit breached the Stability Pact limit of 3pc of gross domestic product this year //www.fxcentre.com