Rome

EU summit ratifies closure of Italy deficit procedure

Rome brings deficit-GDP ratio back under 3% threshold

EU summit ratifies closure of Italy deficit procedure

Rome, June 28 - European Union leaders have ratified the closure of an excessive-deficit procedure against Italy and other nations, an end-of-summit statement said Friday. In May the European Commission recommended that the procedure it opened against Italy in 2009 be ended and the move was upheld by the ECOFIN council of EU economy ministers last week. The procedure has been closed as Rome has forecast that Italy's budget-GDP ratio will be under the 3% threshold allowed by the European Union this year, at 2.9%. It was 3% last year. A country has to be within the deficit margin for two consecutive years for the procedure to be closed. The EU, however, warned Italy and the other countries to emerge from deficit procedures that they must keep working to improve the health of their public finances and introduce structural economic reforms. "The European Council welcomes the abrogation of the excessive-deficit procedure for several Member States as well as the efforts of those which are expected to meet their fiscal targets," the statement read. "At the same time, Member States should accelerate their structural reforms. This will underpin efforts for a rebalancing of the EU economy, help restore competitiveness and address the social consequences of the crisis". The end of the procedure will free up around eight billion euros for the Italian government as of next year. This is because Italy is no longer obliged to devote part of its budget to debt-cutting measures.

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