4 February 2004, 16:43  EU's Solbes says stability pact rules too rigid

BERLIN, Feb 4 - The European Union's Stability and Growth pact could be changed so that any assessment of a country's budget takes account of total state debt as well as the deficit, European Monetary Affairs Commisioner Pedro Solbes said on Wednesday. In an interview with German weekly magazine WirtschaftsWoche, Solbes said such a change could mean that countries were allowed to overshoot the pact's budget deficit limit of three percent of gross domestic product. "In times of economic weakness, the pact is too restrictive and sometimes the rules seem too rigid," the magazine quoted Solbes as saying, in an advance of this week's edition. Changing the pact could allow countries with a relatively small debt and deficit to temporarily increase their budget shortfall, as long as that nation "was increasing government investment to address structural problems," Solbes said.//

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