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May 20, 2020

All EU states will break through the 3% ceiling for the deficit / GDP ratio this year, including Romania which was already in the corrective arm of the stability pact, to combat the crisis caused by the Covid-19 pandemic, but no excessive deficit procedure will be initiated. This was communicated by the Commission, which prepared, as required by the Treaty, a report pursuant to Article 126.3 of the TFEU for all Member States, except for Bucharest, which was already out of the norm.

In 2019 Italy respected the debt rules
The reports for France, Belgium, Cyprus, Greece, Italy and Spain also examine compliance with the debt criterion in 2019, based on data validated by Eurostat. "In light of the exceptional uncertainty related to the macroeconomic and extraordinary budgetary impact of the pandemic, the Commission considers that a decision should not be taken at this juncture on the launch of excessive deficit procedures," stresses the EU executive. 

Recommendations
The Commission today proposed country-specific recommendations, which provide economic policy guidelines to all states in the context of the pandemic.

The recommendations are structured around two objectives: in the short term, to mitigate the serious socio-economic consequences of the pandemic; and in the medium term to achieve sustainable and inclusive growth that facilitates green transition and digital transformation. The recommendations cover the four dimensions of competitive sustainability - stability, equity, environmental sustainability and competitiveness - and place a specific emphasis on health. They concern sectors such as investments in public health and health sector resilience, job retention through income support for the workers concerned, investment in people and skills, support for the business sector (in particular small and medium-sized enterprises) businesses) and action against aggressive tax planning and money laundering.

This year, the recommendations to states are qualitative, 'notwithstanding the budgetary requirements that would normally apply'. This is due to the activation of the general clause of 'escape', that is to say suspension of the stability pact. Therefore, Member States are recommended to 'take all necessary measures to effectively tackle the pandemic, support the economy and recovery'. When economic conditions 'allow, fiscal policies should aim to achieve prudent medium-term positions and ensure debt sustainability, while improving investment'.