EU Initiates Actions Against Seven European Countries for High Debt Levels
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The European Union has initiated cases against France, Italy, and five other member countries over their budget deficits and high levels of debt.
Germany's Tagusschau newspaper reported that the EU has launched these cases due to the excessive accumulation of new debts by the countries involved.
Following the official announcement in Brussels, the Council of the European Union made a decision to address the issue. In addition to France and Italy, Belgium, Malta, Poland, Slovakia, and Hungary have also been included in these proceedings. Cases initiated in 2020 against Romania are continuing after coordination among the countries.
The primary aim of these deficit cases is to ensure that governments maintain sound financial management. While theoretically fines in the billions of dollars are possible for repeated violations, they have never been imposed in practice.
Each country had to independently start the new procedures. The next step involves the European Commission providing recommendations on debt relief to member states, which must then be approved by the Council of the European Union. This process is currently scheduled for completion by the end of the year.
Close monitoring of budgets and follow-ups on deficit cases in the EU were recently halted due to the COVID-19 crisis and the aftermath of Russia's actions in Ukraine. If criminal proceedings are initiated, countries must take measures to reduce their debt and budget deficits. The main goal is to maintain stability within the Eurozone.
The European Commission oversees compliance with rules on budget deficits and public debt among EU countries. These rules allow for new debt up to three percent of GDP, while a member state's debt level cannot surpass 60 percent of economic output.
Presently, seven EU countries are facing consequences due to their extensive debts.
The Council of the European Union has authorized the consideration of criminal cases against France, Italy, and five other countries because of their excessive new debts.
These countries have officially been targeted for financial deviations as they have violated the budget rules of the Union, potentially leading to significant penalties unless corrective actions are taken in their budget systems.
Countries such as Belgium, France, Italy, Hungary, Malta, Poland, and Slovakia have shown excessive financial deficits compared to EU standards, prompting decisions to address these issues.
The EU is preparing to implement the "excessive deficit procedure," requiring member states to present plans to Brussels to rectify their debt and deficit levels in accordance with EU standards.
Despite the initiation of this process against Romania in 2020, there have been no measures taken by the country to address its financial deficit.
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