Pedro Solbes Hints At Economic Leeway For EU Accession States

by Ulrika Lomas, for LawAndTax-News.com, Brussels

08 April 2004

Speaking before the European Parliament on Tuesday in his last appearance before he returns to Spain to act as Finance Minister, the EU's Economic Affairs Commissioner, Pedro Solbes hinted that the European Union may ease its economic rules in order to smooth the transition for the ten countries set to join the EU next month.

According to reports, Mr Solbes told MEPs that: "We might perhaps allow a multi-annual period to allow them to exceed the three percent of GDP (rule)...in order to avoid an undesirable economic impact," going on to add that:

"Obviously, we will have to consider the situation of the new member states and...allow some flexibility from the absolute rigour of the rules."

However, he stressed that the 3% limit imposed by the Stability and Growth Pact should remain the "anchor" figure.

Speaking following the Commissioner's announcement, EC spokesman Gerassimos Thomas clarified the situation, explaining that the accession states will still need to maintain deficits of under 3% of gross domestic product (GDP) in order to be permitted to join the eurozone.

It emerged this week that the EC is planning to take action against France, Germany, Greece, Italy, the Netherlands and the UK over breaches of the euro rules.

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