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MNI:Frugal Fury At EU Guidance Endangers Pact Reform-Officials

(MNI) Brussels

Germany and other "frugal" nations objected to the European Commission's latest fiscal guidance, officials say.

A backlash from Germany, and other “frugal” countries after the European Commission applied its preferences for a new set of fiscal rules to guidance for member states’ 2024 budgets could mean an already tight window for agreeing on reform has become even narrower, officials in Brussels told MNI.

The angry reaction by Germany, together with Austria and the Netherlands, prompted changes to draft conclusions by finance ministers set to be approved by leaders later this week, to include clear acknowledgement that key elements of the Pact’s reform had still to be agreed, the officials said. Germany perceived this year’s fiscal guidance as incompatible with the old rules under the Stability and Growth Pact, which is currently suspended due to the economic impact of Covid and the war in Ukraine and whose reform has been the subject of protracted and difficult negotiations.

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A backlash from Germany, and other “frugal” countries after the European Commission applied its preferences for a new set of fiscal rules to guidance for member states’ 2024 budgets could mean an already tight window for agreeing on reform has become even narrower, officials in Brussels told MNI.

The angry reaction by Germany, together with Austria and the Netherlands, prompted changes to draft conclusions by finance ministers set to be approved by leaders later this week, to include clear acknowledgement that key elements of the Pact’s reform had still to be agreed, the officials said. Germany perceived this year’s fiscal guidance as incompatible with the old rules under the Stability and Growth Pact, which is currently suspended due to the economic impact of Covid and the war in Ukraine and whose reform has been the subject of protracted and difficult negotiations.

Keep reading...Show less