EU to strike Germany, Bulgaria from deficit blacklist
(BRUSSELS) - The European Commission recommended on Wednesday the removal of Germany and Bulgaria from a list of countries facing the threat of sanctions after they brought their deficits under the EU limit.
The commission said excessive deficit procedures against the pair could be lifted after Germany cut its shortfall to 1.0 percent in 2011 and Bulgaria reduced it to 2.1 percent, well below the EU ceiling of 3.0 percent of economic output.
"The commission has concluded that the correction of the excessive deficit for these countries is ensured," the EU's executive arm said in a statement, noting that they would "remain durably below 3.0 percent."
The European Commission said it has forecast that the German deficit will shrink to 0.9 percent in 2012 and 0.7 percent in 2013 while Bulgaria's will fall to 1.9 percent and 1.7 percent.
The recommendation, if endorsed by EU leaders in late June, will leave 21 of the EU's 27 member states under deficit proceedings, including France, Italy, Spain and Britain.
Estonia, Finland, Luxembourg and Sweden are the only other countries that have avoided the excessive deficit procedure.
The EU tightened its debt and deficit rules late last year, making it easier to impose sanctions on governments that repeatedly fail to rein in spending.
2012 country-specific recommendations in the context of the European Semester - guide
Conclusion of 12 in-depth reviews - correcting macroeconomic imbalances
Excessive Deficit Procedure recommendations on Bulgaria, Germany and Hungary - guide