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Juncker criticizes Italy's excessive deficit

June 12, 2019

The European Commission president has said Italy is moving in an "unsound direction" regarding public debt. Jean-Claude Juncker warned Rome to rethink, though Italy's leaders appear divided.

European Commission President Jean-Claude Juncker
Image: Getty Images/AFP/E. Vidal

European Commission President Jean-Claude Juncker on Tuesday said that Italy was "moving in an unsound direction" in financial terms.

Juncker warned that Italy's excessive debt could last "for years" if reforms were not adopted.

Read more: The fine art of defusing Italy's budget row

Italy's public debt stood at 132% of its gross domestic product (GDP) in 2018 while the Eurozone calls for member states to stay within 60%. Though most members do not adhere to these rules, Brussels would like to see the figure decreasing rather than increasing, as in Italy's case.

A decision is not expected until next week but an unnamed EU official told dpa on Tuesday that member states were prepared to enact disciplinary measures.

Outgoing Commission President Juncker was keen to avoid any disciplinary action but said that it "will depend on the coming commitments to be taken by the Italian government."

Read more: Worst invasion of locusts in 60 years hits Sardinia

The firm stance followed the release of a report which claimed the Mediterranean country was "not projected to comply with the debt reduction benchmark in either 2019 or 2020 based on both the government plans and the commission 2019 spring forecast."

Confusion reigns

Fears remain that Italy will ignore these threats despite Prime Minister Giuseppe Conte vowing to do all he can to avoid triggering EU sanctions. Conte said: "The negotiation with the European Commission and with our European Union partners will see the government absolutely determined to avoid, in the coming months, a procedure for excessive debt."

European Commission President Jean-Claude Juncker meeting with Italian Prime Minister Giuseppe Conte in Brussels, Belgium, in 2018
Giuseppe Conte and Jean-Claude Juncker meeting here in Brussels in November 2018 when the EU also warned about Italy's excessive debtImage: picture-alliance/Xinhua News Agency/Ye Pingfan)

The Italian leader also urged Juncker to listen to the government's explanations regarding the numbers before saying they were heading in the wrong direction.

Nevertheless, Conte's comments were in stark contrast to Italy's far right Deputy Prime Minister Matteo Salvini who has promised not to give in to the EU's demands.

Relations between Italy's coalition government and the bloc have been strained recently and the latest calls for action will only add to the tensions between the two.

jsi/se (dpa, Reuters)

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