reform of tax rules -to update budget discipline rules In the European Union – enter the final stage, focusing on reaching a political agreement at the meeting of Economy and Finance Ministers (Ekofin) December. For now, Acting Minister of Economy Nadia Calviño, who represents the Spanish Presidency of the European Union this term, presented a consensus proposal to the Ecofin table this Thursday for an “exit zone”, in Calviño’s words. This is a text that reinforces the first text presented by the European Commission in April and aims to provide a clue to the solution of the problem. Political dispute between France and Germany On the design of new financial rules
Calviño brings to Ecofin a document that opens the door to requesting minimum budget adjustments for countries with debt greater than 60% of GDP
“This landing zone We offer guarantees Gradual and consistent reduction of public debt. “It also allows for the creation of fiscal space to respond to new crises and promotes fundamental reforms in priority areas for the European Union,” Calviño said at a press conference after the Ecofin meeting, admitting that “there is still a lot of work to do”. “The basic elements of the framework, the mechanisms that need to be implemented and “guards”He pointed out the minister who said that now “what remains is this”: fine-tune details and calibrationn, so it is necessary to start working on it legal text“.
The key is in security measures
Nadia Calvino explained this Proposal of the Spanish Presidency He put it on the table this Thursday, having intensified his contacts with European capitals in the last 15 days and held more than 50 meetings. sunflower seed It is part of the proposal launched by the European Commission: for each country to develop its own medium-term adaptation path. Innovation lies now “guards” These personalized adjustment paths meet minimum requirements – capable of reassuring even the most hard-line Germany – and this is what Spain is tightening its “landing zone” to ensure that the reform is accepted by Germany.
The word “protection” From now on, this will become the key to the pending negotiations. The Spanish deputy minister did not explain the content of these measures, but touched on the following fact: affects deficit and debt and implied that its quantity was something to be worked out precisely (“calibration“).
In the legislative proposal submitted by the European Commission in April, Germany had already managed to take a measure: the text mandated a minimum annual budget adjustment of 0.5% of GDP for countries with a deficit of more than 3% of GDP.
The following are now added to the offer that Spain made to Ecofin this Thursday: A new measure regarding debt. Although Calviño did not elaborate on this, sources familiar with the document said that this measure Minimum annual adjustment also for countries where public debt is more than 60% of GDP. In this case, first of all, Greece, Italy, Portugal, France, Spain and Belgium (With data for 2022).
“Proposal ‘landing zone’ It preserves the spirit of the European Commission. What he does is to develop and adjust it further to reach the necessary political agreement. One innovation currently being discussed is the maintenance of the deficit. It all depends How is this protection calibrated?but this is still to be discussed,” said the European Commission vice-president. Valdis Dombrovskis To summarize the status of the issue;
Franco-German negotiation
“Calibrate” is the second keyword of the ongoing negotiations. And here come the open negotiations between France and Germany, symbolizing two opposing positions on the reform of fiscal rules. “It’s not just about the tools anymore, it’s about the numbers,” the German Finance Minister summarized: Christian Lindner this Thursday, before the Ecofin meeting.
France’s finance ministers Bruno Le Maireand from Germany, Christian Lindner They are optimistic about the possibility of closure Franco-German agreement This allows removing the obstacle to reform of fiscal rules. Both ministers defended this a meeting in Paris this week To advance the deal, he announced this Thursday: They will keep another one in Berlin At the end of the month.
Calendar
The results of these negotiations will be brought to the table Extraordinary meeting from Ecofin As Calviño explained, this meeting will be held in the last days of November as a preliminary step. December ordinary meetingIn line with the wish expressed by all ministers, it is desired that the legal text on reforming fiscal rules be adopted before the end of the year.
This Calendar In the press conference he held after the Ecofin meeting, Calviño, as EU vice president, stated the following: doesn’t feel weak Because the final agreement depends on what France and Germany agree on. “On the contrary. I find it very valuable that France and Germany are trying to support the work of the Spanish Presidency,” he said.