EU unlikely to take further steps against Italy over debt next week

EU unlikely to take further steps against Italy over debt next week
FILE PHOTO: People walk past the European Commission headquarters, in Brussels, Belgium May 28, 2019. REUTERS/Yves Herman -
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YVES HERMAN(Reuters)
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BRUSSELS (Reuters) – The European Commission is unlikely to recommend next week the opening of a disciplinary procedure against Italy over the country’s rising debt because it will wait for Rome’s measures on how it wants to comply with EU rules, EU officials said.

The next meeting of the European Commission, the EU executive arm that is the guardian of EU rules, is on June 25th.

But Italy is only expected to present its steps to comply with EU fiscal rules, that require reductions in deficit and public debt, later.

“The Italians will publish their mid-term budget on the 26th or the 27th and obviously the Commission will have to take that into account before doing anything. So the more likely date is the first week of July,” one euro zone official said.

EU finance ministers believe that Italy is breaking EU rules with its rising public debt and structural budget deficit and unless Rome presents steps to correct that, the Commission will recommend disciplinary steps, that could end in fines.

Once the Commission makes such a recommendation, it would have to be endorsed by EU finance ministers, who meet for regular talks on July 8-9. Under EU law a decision whether to start steps against Italy or not has to be taken by Aug 1.

A second euro zone source said that even a Commission recommendation were to come in the first week of July, EU finance ministers could still deal with it that month.

(Reporting By Jan Strupczewski)

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