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GERMANY and its northern European allies jumped on proposals to loosen EU rules on government budget deficits and debt, insisting that stability was paramount.
Italian Prime Minister Renzi also urged more leeway in the rules that limit member states’ budget deficit to 3 per cent of gross domestic product and total debt to 60 per cent.
He was said to have had sharp exchanges with German Chancellor Angela Merkel over dinner on Thursday night.
Her close ally, new Finnish Prime Minister Alexander Stubb, insisted that stability was paramount to avoid another financial crisis, declaring that the rules “need no more flexibility.”
Belgian Prime Minister Elio di Rupo has also proposed “more flexibility” for countries seeking to balance their budgets within a few years.
“Growth needs to be restarted to avoid hurting companies and citizens,” he added, suggesting that low interest rates meant EU states were under less pressure from financial markets.
