Deal close on tightening EU economic governance: Parliament

(BRUSSELS) - A deal to tighten economic governance in the eurozone by imposing penalties on countries that fail to meet debt and deficit targets has moved closer, the European Parliament said on Wednesday.

After months of stalled negotiations, a new compromise proposal on the so-called six-pack reforms "was broadly considered as a very positive step forwards" a parliament spokesman said.

The European Parliament has been insisting that preventative sanctions be imposed automatically on countries that are about to exceed debt and deficit limits, which can only be waived if a majority of countries agree.

The European Council, which gathers the EU heads of state or government, had so far accepted this so-called reverse voting procedure only for sanctions after countries have violated the debt or deficit targets.

"The end is in sight," the parliament's Liberal group said in a separate statement, ahead of a full session for Euro MPs next week in Strasbourg.

The six-pack reforms aim to put teeth back into the EU's Stability and Growth Pact, which was supposed to ensure countries keep their public deficits under three percent of output and their debt under 60 percent.

The pact was watered down in 2005 after the biggest economies Germany and France burst its provisions in 2003.