EC Suspends Disciplinary Proceedings Against France And Germany
According to reports in the European media, disciplinary proceedings brought
by the European Commission against the French and German governments over their
failure to adhere to the 3% of GDP budget deficit ceiling for Eurozone countries
have been suspended. The EU Observer revealed that a report presented by Economic and Monetary Affairs
Commissioner, Joaquin Almunia showed that the two countries are likely to be
able to rein their budget deficits in next year, France as a result of increased
growth levels, and Germany as a result of greater fiscal stringency. Speaking to the news service, an unnamed source close to the EC observed that: "There seems to be a real willingness to comply. No further steps are
necessary...this is not a political decision and the Commission will continue
to monitor the situation." In November 2003, the French and German governments persuaded EU finance ministers
to suspend the proceedings against them for the first time, an action which
sent the EC to the European Court of Justice to reverse the decision. However,
tempers have since cooled, and work is underway to increase the flexibility
of the Stability and Growth Pact, which governs the Eurozone economies. .
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