Stability and Growth Pact

The International Monetary Fund sees Greece returning to fiscal consolidation, with systematic achievement of primary surpluses and debt deleveraging in the coming years, per its spring fiscal report, published on Wednesday.

Economic powerhouse Germany wants EU members to be given binding targets to slash their debts under new spending rules being prepared by Brussels, a document seen by AFP has showed.

In November, the European Commission, the EU's executive arm, put forward plans to reform the Stability and Growth Pact that limits how much EU countries can borrow.

European governments have spent hand over fist, despite ballooning public debt, to prevent the coronavirus pandemic from triggering economic calamity.

Now, the European Union faces calls to loosen its budget rules to allow the largesse to continue, but the topic is a sensitive one for many member states.

The draft budget amendment weakens the budgetary consolidation as it was announced for 2021, the Fiscal Council said on Thursday night, in a release.

The budget measures taken this year are enough to secure the European Commission's nod of approval for the adjustment strategy presented in Brussels and the return of the deficit to 3 percent of GDP by 2024, Finance Minister Alexandru Nazare said on Monday at the launch of the Bucharest Stock Exchange - Envisia Boards of Elite partnership dedicated to capital market players.

The Recommendation on the Excessive Deficit Procedure in the case of Romania was adopted on Friday at the Meeting of the Economic and Financial Affairs Council (ECOFIN), in Luxembourg, and our country's commitment is to return to a budget deficit up to 3% of GDP by 2024, according to a press release from the Ministry of Finance.

The European Council on Friday adopted a recommendation under the excessive deficit procedure for Romania that Romania should put an end to the excessive deficit situation by 2024 at the latest. "The Council found that an extension to the current deadline for Romania to correct its public deficit would be important in order not to compromise the economic recovery after the COVID-19 pandemic.

Romania will record economic growth of between 6 and 7% in 2021, Daniel Daianu, chairman of the Fiscal Council said on Wednesday, adding that there is an economic rebound, there is public investment spending of 5.5% of the Gross Domestic Product (GDP), more than in 2020. "I believe that, indeed, the growth will be between 6 and 7% in 2021. It might as well be 7%.

Ljubljana – The Fiscal Council has noted that at least one of the two conditions enabling the government to depart from the obligation of medium-term fiscal balance under exceptional circumstances will be met next year. It has thus advised caution and again called on the government to clearly define mitigation measures and quantify their fiscal effect.

The European Union signaled Wednesday that it will not punish member countries for breaking the bloc's deficit rules to tackle the coronavirus but that it could condition their access to sorely-needed recovery funds on them following its advice on how to manage their budgets.