Although not on the agenda, European Union finance ministers meeting near Stockholm yesterday wanted to give their first impressions after the presentation of expected fiscal rules this week by Brussels. The Community Executive defended his proposal as “good and balanced” and is optimistic about the negotiations that they want to finalize before the end of the year. Although no one hides the difficulties, especially since Germany does not hide the fact that the plan has not convinced it.

The Commissioner for the Economy, Paolo Gentiloni, puffed up his plan, and was “optimistic” that it will lead to compromise by all countries, despite the fact that everyone has something to say about it. “This can usually mean that we either have a very good and balanced proposal or it is that we live on another planet, and we do not live on another planet, so we have a very good and balanced proposal,” he defended. In his opinion, the Executive’s plan has been able to find the perfect point between “solid finances and the need to boost growth”. However, he was open so that everyone can find an accommodation in the new plan.

The Executive’s proposal proposes fiscal paths for four years, in which each country will have to present national plans agreed with Brussels, with debt reduction if it exceeds 60%. In the deficit, if it exceeds 3%, an adjustment of 0.5% must be made annually. The evolution of public spending will be used as the main indicator, but with room for investment and thus not stifle European competitiveness.

But Germany has already made it clear that it wants more rigor. The country’s Finance Minister, Christian Lindner, has always defended a fixed target for debt reduction (1% per year) and insisted that he wants “safeguards”, although he assures that it will be constructive “always”. “I am friendly, optimistic and polite,” he joked when asked after writing a harsh statement in the Financial Times newspaper this week in which he accused Brussels of reducing the entire proposal to “a political negotiation”. “The most important thing is that spending does not grow above the GDP”, he added.

Despite the constructive spirit to which the liberal minister appealed, and the intention shown by a large number of countries that the new fiscal rules begin to be applied in 2024, Lindner recalled that there are previous regulations, currently suspended. “As long as there are no new ones, the previous rules apply,” he added.

However, the objective set is that by the end of 2023 an agreement is reached, that is, the bulk of the negotiation and its completion would end in the rotating presidency of Spain of the Council of the EU. In this regard, the Vice President and Minister of Economic Affairs, Nadia Calviño, assured that the Government will do “everything possible” to achieve it or at least “advance” as much as possible.

Also the Dutch minister Sigrid Kaag, who showed the need to advance in the new package, warned of the bad signals that it could send to the markets (“they are watching”, she stressed) if an agreement is not reached this year. “I’m not worried yet, but I’m worried that we start arguing about what we want to negotiate, instead of getting down to business,” she warned. An approach that was also supported by the president of the European Central Bank, Christine Lagarde, who welcomed the new proposal with “satisfaction” because it favors a “sustained” debt reduction, but also encourages investment.

At the same time, and while the ministers were meeting, Eurostat released the first growth data for the euro area for the first quarter of the year, in which an increase of 0.1% of GDP was confirmed, thus removing the risk of recession that was forecast in A beginning. Gentiloni confirmed that the data is “better than expected” according to forecasts and especially valued the growth of Portugal (1.6%) and Spain (0.5%).