The European Commission decided Wednesday not to fine eurozone countries Spain and Portugal for overspending in 2015 but opted for granting them more time to correct budget deficits.
The European Commission decided Wednesday not to punish Spain and Portugal for overspending in 2015. EU economics Commissioner Pierre Moscovici said in a climate where people were questioning the EU project, sanctions, even if they were just symbolic were not the answer. He praised the Spanish and Portuguese for the sacrifices they made during the financial crisis.
The EU stability and growth pact states that annual budget deficits of Eurozone countries should be kept below 3 percent of national gross domestic product and any country that breaks this rule can be fined up to 0.2 percent of national GDP, or have their structural funds slashed, but to date, the European Commission has never proposed such punishment, for fear of a populist backlash.