The European Commission said on Wednesday it will not suspend EU funds for Spain and Portugal next year following their breach of EU budget rules, as it also called for looser fiscal policy across the euro zone.
The European Union’s executive Commission has the power to impose fines and to suspend EU funds for countries that run deficits above 3 percent of their gross domestic product and do not take measures to correct their excessive gaps.
The Commission has come to the conclusion that the Excessive Deficit Procedures of both Member States should be held in abeyance. Accordingly, the event that required a proposal by the Commission to suspend parts of the European Structural and Investment Funds is no longer present and there will be no such proposal,”
-the press release said.
“EU Commission concludes that action by Spain & Portugal is sufficient to avoid a suspension of EU funding,”
-European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici wrote on his Twitter account, referring to the EC conclusions.
In June, both Spain and Portugal dodged a fine for similar failures in the reduction of their 2015 deficits.During the Autumn Package, the EC sets out its analysis of the 2017 framework proposals submitted by all the eurozone nations except Greece.The deadline for these frameworks came at a time when Spain was functioning under a caretaker government and therefore could not draw up legislation on its national budget