Spain and Portugal threatened sanctions for excessive deficit – Challenges.fr

by Francesco Guarascio

BRUSSELS (Reuters) – The European Commission Thursday opened a sanction excessive deficit procedure against Spain and Portugal, which risk being fined by the end July.

These two countries recorded in 2014 and 2015 government deficits above the permitted limit of 3% of gross domestic product (GDP) and have not reduced the agreed rhythm, said the EU executive.

Spain and Portugal now face fines and the suspension of their access to European funds if they fail to prove that their budget situation results from “economic circumstances exceptional “.

the decision of the European Commission could therefore still fragile fiscal position but also politics of both countries.

in Spain, political parties fail to form two government after parliamentary elections in six months did not reveal an obvious majority in the chamber of deputies.

Portugal is in turn governed by a minority Socialist government dependent on support left parties.

in front of the parliament, the Portuguese Prime Minister Antonio Costa said he was convinced to get the country out of the excessive deficit procedure “no plan B, without additional measures, but only acting with determination and rigor “.

the leader of the left Bloc, which supports the government without participating, denounced during the parliamentary debate an unacceptable attack against Portugal and urged the government there resist. Catarina Martins found that the initiative taken against Spain and Portugal proved that there was within the EU of double standards with regard to respect fiscal rules.

THE PENALTIES MAY WELFARE zeroed HEREBY DOMBROVSKIS

the President of the European Commission, Jean-Claude Juncker, said late in May that France has benefited from an indulgence on the part of the EU executive “because that is France. “

European regulations provide for fines of up to 0.2% of GDP for countries in the euro area which do not resorb their excessive deficits. Such sanctions have not been applied until now.

The ministers of EU finance will vote on the recommendation of the Commission vis-à-vis Spain and Portugal at their meeting scheduled on July 12, said a spokesman for the EU Presidency Slovak.

it is unlikely that the Council goes against this recommendation because it would require a qualified majority of Member States.

After the decision of the Council made, the Commission will propose sanctions “within 20 days”, said the EU executive. Spain and Portugal could well be punished by 27 July, the date of the last Commission meeting before the summer break.

The two countries have for them 10 days to prove that they are faced with exceptional economic circumstances or propose corrective measures

“We are open to dialogue,” assured Pierre Moscovici, European Commissioner for economic and financial Affairs, at a press conference . Brussels

Valdis Dombrovskis, Vice-President of the Commission of the euro, for his hand said: “There will certainly during this procedure a possibility for them to submit requests motivated to reduce potential sanctions or possibly even reduce them to zero. “

Spain posted in 2015 a deficit of 5.1% of GDP, while the Commission claiming to 4.2%. Portugal has for its part recorded a deficit of 4.4% of GDP while it was supposed to bring the 2.5%

(Andrei Khalip in Lisbon. Bertrand Boucey for the French service edited by Marc Angrand)