Italy risks EU sanctions by sticking to debt-happy budget

I

Italy’s government defied the European Commission on Tuesday by sticking to its big-spending budget plan, risking financial sanctions in a high-stakes standoff with Brussels.

Despite pressure from the European Commission, which rejected Rome’s budget outright last month in a first for the EU, Italian Deputy Prime Minister Luigi Di Maio vowed to stand firm on the country’s anti-austerity plans.

“The budget will not change, neither in its balance sheet nor in its growth forecast. We have the conviction that this is the budget needed for the country to get going again,” Di Maio, who leads the anti-establishment Five Star Movement (M5S), said on Tuesday evening after a ministerial meeting.

M5S and its coalition partner, the League, insist the budget will help kickstart growth in the eurozone’s third largest economy and reduce the public debt and deficit. League head Matteo Salvini, who is also a deputy prime minister, vowed on Monday to put his back into “defending the budget, as if it were a rugby scrum”.

The Commission had given Italy until Tuesday to make changes to its 2019 plans and warned non-compliance could activate the “excessive deficit procedure” (EDP), a complicated process that could lead to fines and possibly provoke a strong, adverse market reaction.


By: Lesley Woutersen

Lesley Woutersen, one of the co-founders of the EconomicInform gives away all of his free time to the project. He is interested in stock exchange and digital assets. Lesley can be reached by lesley.woutersen@economicinform.com.

Add comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Recent Posts

Categories

About us

EconomicInform, EconomicInform.com is a product of EconomicInform LLC. We sincerely believe that economics is one of the most interesting and most underappreciated – in terms of getting some enjoyment out of reading the subject articles – sciences. More on that - at the link. Feel free to drop us a line.