Italy to trigger EU’s excessive deficit procedure, minister warns

7 months ago 36

Italy will undoubtedly trigger the EU’s excessive deficit procedure (EDP), Italian Economy Minister Giancarlo Giorgetti said on Wednesday as he ruled out taking up the post of commissioner following June’s EU elections.

During a Wednesday hearing on the reform of European economic governance, Italian Economy Minister Giancarlo Giorgetti (Lega/ID) said the European Commission will recommend the Council of the EU to open an excessive deficit procedure against Italy, along with several other countries.

“We are not so dumb as to have made a negotiation without knowing what the terrain and scenario we were going into was”, the minister said, referring to the Stability and Growth Pact, introduced following the pandemic and extended due to the energy crisis, which ended at the end of 2023.

After the European elections in June, the European Council will present its recommendations on the health of national public accounts and the list of countries whose public deficit has exceeded 3% of GDP and will, therefore, be subject to an EDP.

At the end of 2023, Brussels announced that the new budgetary rules that should be triggered next year will affect at least a dozen states, including Italy and France.

According to the first Istat estimates, the Italian government’s net borrowing recorded last year was €149,475 million or 7.2% of GDP.

Italy is preparing to write the Economic and Financial Document, which will be presented to the country’s parliament by 10 April and, according to the Commission’s instructions, will likely be lighter than in the past.

However, the constraints of the new European governance require “a change of perspective” that will progressively lead from the emergency phase towards an “ordinary path”, Giorgetti recalls, adding that “it is appropriate to intervene to further strengthen governance processes and monitoring tools at the regulatory level”.

According to the minister, periodic reporting flows by the managers are necessary to maximise the efficiency of using the resources already allocated for coverage in medium—and long-term planning and perspective logic.

On the subject of public guarantees, the minister reported that as of 31 December 2023, the State’s exposure stood at around €300 billion, or around 14.4% of GDP, down from 15.9% in 2022 and the peaks reached during the COVID-19 pandemic, which reached 16.1% of GDP, but still far from the 4.9% of 2019.

Giorgetti continues to refuse any position within the European Commission. “Five years ago, I expressed my unavailability to those who proposed it to me, so I don’t give a damn”, he said.

(Federica Pascale | Euractiv.it)