Future EU bailouts only for Euro+ Pact signatories, new draft says

Only countries that have signed and apply the Euro+ Pact can get bailouts from Europe, projects the latest version of the European Fiscal Pact, agreed by most of the EU leaders at the beginning of December, reported EUObserver. Granting of assistance in the framework of new programmes under the European Stability Mechanism (ESM) will be conditional, as of March 1, 2013, on the ratification of this treaty, says the document. Until now, ESM projected bailouts only for Eurozone member-states.

The draft agreement retains the golden rule for a balanced budget which should be legally stipulated, preferably in the constitution. It obliges governments not to go beyond an annual structural budget deficit of 0.5% of GDP. A structural deficit is a deficit which does not include temporary or one-off budget items.

The balanced budget rule can be set aside under ‘exceptional circumstances’ or ‘a severe economic downturn’, the draft stipulates. A country failing to comply with the rule will be taken to the European Court of Justice by one of the other signatories and not by the European Commission as projected in an earlier version of the treaty. Another new idea is for ESM to be the recipient of any fines imposed by the EU on the deficit sinners. The Court may impose a financial penalty of up to 0.1% of the respective country’s GDP, writes EUObserver.

“Next week, we will be able to say whether Bulgaria will sign the Euro+ Pact, whether our country will undertake a commitment to it before we join the Eurozone and with respect to which articles of this treaty, or whether we will take another position,” Deputy Minister of Foreign Affairs Konstantin Dimitrov said on Monday, quoted by BTA. Bulgaria does not agree with Article 4 of the treaty on the tax harmonisation between the signatories.

Прочети цялата новина

Свързани новини: