BRUSSELS (MNI) – The European Commission said Wednesday that Spain
had fulfilled its economic and fiscal obligations under EU rules for
this year and next but warned that it could need to take more action to
hit targets in 2014 if the economy performs worse than the Spanish
government expects.
“We have concluded that for 2012 and 2013 Spain has taken effective
action to restore the sustainability of its public finances,” EU
Economic and Monetary Affairs Commissioner Olli Rehn told a press
conference here.
Structural reforms to improve the flexibility of the Spanish labour
market and open up closed professions “go a long way” towards meeting
objectives set out for Spain by the Commission and EU governments,
Rehn said.
The Commission’s thumbs up for Spain’s fiscal measures comes
despite the fact that Madrid is on course to miss nominal budget deficit
targets, as the Commission focuses on calculations for the medium-term
structural balance, which excludes one-off measures such as money to
recapitalize banks in the case of Spain.
“We are focusing on structural rather than nominal targets,” Rehn
said, echoing a previous statement on Spain made October 22.
The European Commission will re-examine Spain’s compliance with EU
fiscal rules in February when it publishes its Winter Economic Forecast
at all EU countries.
Some of Madrid’s forecasts for 2014 look “optimistic,” Rehn warned.
In its 2013 budget plan released early October, the Spanish government
estimated that government support for the country’s troubled banks would
increase the budget deficit to around 7.4% of GDP this year, above the
target of 6.3% for 2012 it has promised its EU partners.
The government also raised its estimate of last year’s budget
deficit to 9.44% of GDP from 8.96% to take into account measures to
help its banks. Madrid said that if the effect of measures to help banks
were excluded, it would meet its EU commitments.
–Brussels Newsroom, +324-952-28374; pkoh@mni-news.com
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