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BRIEF: EU Debt Plans Over-Optimistic On Growth-ECON Testimony

Some EU states' debt plans need to be amended, according to expert testimony to the European Parliament.

MNI (BRUSSELS) - Some European Union countries have based fiscal consolidation plans on overly-optimistic estimates of future potential growth, a fiscal expert told the European Parliament's ECON Committee on Wednesday. 

"I wonder how the Commission will evaluate those. I personally would conclude that this fast growth is not justified by the plan so you need to go back to the lower growth assumptions and do the adjustment accordingly,” said Bruegel Senior Fellow Zsolt Darvas, referring to fiscal-structural plans submitted by EU states as required by new EU fiscal rules. (See INTERVIEW:  Fiscal Contraction To Give ECB More Room To Cut)

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MNI (BRUSSELS) - Some European Union countries have based fiscal consolidation plans on overly-optimistic estimates of future potential growth, a fiscal expert told the European Parliament's ECON Committee on Wednesday. 

"I wonder how the Commission will evaluate those. I personally would conclude that this fast growth is not justified by the plan so you need to go back to the lower growth assumptions and do the adjustment accordingly,” said Bruegel Senior Fellow Zsolt Darvas, referring to fiscal-structural plans submitted by EU states as required by new EU fiscal rules. (See INTERVIEW:  Fiscal Contraction To Give ECB More Room To Cut)

Keep reading...Show less