European Union officials on Wednesday gave France until 2017 to bring its government finances in line with the bloc’s budget rules, despite the country’s continued failure to adhere to them, reports The New York Times.
The European Commission said it was recommending that France be given what amounted to a two-year extension to cut its deficit, which is expected to come in at around 4.1 percent of gross domestic product this year and next, well above the 3 percent ceiling for the bloc.
The commission, the executive arm of the European Union, is charged with signing off on member states’ budgets to ensure they comply with Union rules.
The commission also said it would not recommend that Italy, Finland and Belgium be punished, despite their failure to meet deficit goals, owing to “account key relevant factors,” including the weak economic picture.
In November, the commission gave France, Belgium and Italy a three-month extension on their budget deadlines.
The decision “fully reflects the current economic situation,” Pierre Moscovici, the commissioner for economic and financial affairs, said in a statement, adding: “The commission is demonstrating both the importance of structural reforms and the respect of our fiscal rules.”
The commission said France was not off the hook, however, as officials were recommending “strict milestones for the fiscal adjustment path that will be assessed regularly,” beginning in May.
Under the European Union’s Stability and Growth Pact, member states are supposed to hold their budget deficits to no more than 3 percent of gross domestic product and their government debt to a maximum of 60 percent of GDP.