The Economic and Financial Affairs Council, ECOFIN, has opened excessive deficit procedures for Latvia, Lithuania, Malta, Poland and Romania, issuing recommendations on corrective action to be taken, and has issued a revised recommendation to Hungary on measures to be taken in order to correct its excessive deficit.

It adopted decisions, under article 104(6) of the treaty, on the existence of excessive government deficits in Latvia, Lithuania, Malta, Poland and Romania, which in 2008 exceeded the 3% reference value set by the treaty for the ratio of deficit to gross domestic product (GDP).

On the basis of the outlook provided by the Commission in its spring 2009 economic forecasts, the Council called on Latvia to reduce its deficit below the 3% of GDP threshold by 2012, Lithuania to do so by 2011, Malta by 2010, Hungary by 2011, Poland by 2012 and Romania by 2011.

The Council found that special circumstances in Latvia, Lithuania, Poland and Romania allow for correction of the deficit in the medium term. In the case of Malta, it considers no departure from the standard deadline of the 7th of January 2010 for correcting the deficit to be warranted. As regards Hungary, it found that a revised timetable for correction of its deficit is justified.

According to figures notified by the respective authorities, the general government deficit in 2008 reached 4.7% of GDP in Malta. In its recommendation, the Council called on Malta to ensure that budgetary measures planned for 2009 are rigorously implemented, whilst avoiding any further deterioration in public finances, and to spell out new consolidation measures in order to bring the deficit back below 3% of GDP in 2010.

Permalink: ECOFIN opens excessive deficit procedure for Malta