The Local.es — Following a dramatic post-Brexit vote week a return to “business as usual” for the European Union.
On Tuesday (5/6), the college of EU commissioners will meet in Strasbourg to discusshether Spain and Portugal have failed to take “effective action” to reduce their 2015 budget deficits, a decision triggering a process that could eventually lead to financial sanctions. According to EU officials, the college will say that the two Iberian countries have not taken sufficient measures to reduce their deficits, but will likely fine them a very small, or zero, symbolic amount later in the summer. The commission can impose fines of up to 0.2% of gross domestic product on eurozone countries that repeatedly ignore recommendations to fix their budget problems. Any sanction for countries in breach of the EU’s budget rules would ultimately have to be signed off by the bloc’s finance ministers.
“Neither country met the budget commitments that they had both set themselves,” Oettinger told the mass-circulation daily Bild.
“I believe that if the EU Commission is to maintain its credibility regarding the budget rules, then we will have to impose sanctions on Spain and Portugal,” he continued.
“If we draw up common rules, those rules have to be adhered to. It would be difficult to explain to people if they’re not.”
On Friday, another EU Commissioner, Valdis Dombrovskis, had suggested that Brussels could freeze the structural funding for the two countries.
In May, Madrid and Lisbon received a reprieve when Brussels delayed a decision to slap fines on the rule-breakers until July.
At the urging of Germany, the commission won powers to monitor national budgets during the eurozone debt crisis when overspending in members of the single currency such as Greece and Spain nearly destroyed the euro.
In 2015, Spain’s deficit amounted to 5.0 percent of GDP and Portugal’s 4.4 percent.
Under EU rules, member states are not allowed to run up deficits in excess of 3.0 percent of GDP.
