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EU leaders clash over limits on budgets

Staff writer |
With economic growth still anemic across the European Union, the bloc's leaders clashed Friday over whether to loosen rules limiting government budget deficits and debt.

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Italy, Belgium and others argued more flexibility is needed so they can boost the economy and support job creation, but the more hawkish northern European nations including Germany rejected the idea.

Belgian Prime Minister Elio di Rupo said at a meeting of EU leaders there needs to be "more flexibility, specifically for certain countries seeking to balance their budgets a few years later." "Growth needs to be restarted to avoid hurting companies and citizens. Belgium is part of the countries that need to reduce their debt according to the EU-mandated rules, the so-called growth and stability pact.

But Finland's new Prime Minister Alexander Stubb said stability was paramount to avoid another financial crisis. He insisted the rules "need no more flexibility."

Italian Prime Minister Renzi urged more leeway in the EU rules ahead of the two-day summit, where leaders are to determine the 28-nation bloc's strategic priorities for the coming five years.

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