LONDON (Reuters) – Italy will cut spending to meet its fiscal deficit targets this year and can reach an agreement with the European Commission over its budgetary plans, Economy Minister Giovanni Tria said on Tuesday.
Speaking to bond investors and bankers at a conference in London, Tria sought to reassure the international financial community that Italy would not breach European rules but instead seek to limit its budget by reducing expenditure rather than raising taxes.
“This year we will compensate for the failures of the compliance of (European) fiscal rules (last year). We are going for a deficit of 2.1%. We will do better than the agreement of last year,” he said.
Tria said the main problem for Italy remained low economic growth rather than debt.
(Reporting by Tommy Reggiori Wilkes and Dhara Ranasinghe)