Germany wants EU to push Member States to cut debt levels faster

The European Commission’s proposed reform to European Union fiscal rules should take into account the new economic conditions in the euro zone, German Finance Minister Christian Lindner said on Monday in Luxembourg.

“The conditions for the further development of the Stability and Growth Pact are different today at the end of 2023 than they were at the beginning of the process,” Lindner said, arguing that the reform proposal of the European Commission should be adapted accordingly.

Since the commission put forward its proposed reform in April, the economic situation has sharply deteriorated in the euro zone.

“We should be more ambitious in our debt-reduction paths,” he said, insisting on having annual debt reduction benchmarks that are the same for all countries.

Other countries, like France, believe individually negotiated debt reduction paths are the way to go and that one-size-fits-all policies do not work.

“The International Monetary Fund has clearly underlined that we need to rebuild fiscal buffers,” Lindner said. “We cannot continue with expansionary economic policies.”

via Reuters