FRANKFURT (MNI) – Germany’s Finance Minister Wolfgang Schaeuble
“chiefly supports” proposals by the European Commission for new
sanctions to keep EU member states’ debt levels under control, the
Financial Times reported on Monday.
In a letter obtained by the business daily, Schaeuble also
indicated that in his view it might be necessary to go further to keep
countries in line.
“The creation of stronger incentives to prevent and correct
excessive government deficits stands at the very core of our endeavours
to enforce fiscal and economic governance in the EU,” Mr. Schaeuble
wrote.
The proposals, set to be unveiled Wednesday by both the EU
Commission President Jose Manuel Barroso and the Commissioner for
Monetary Affairs, Olli Rehn, would force countries whose deficits
exceeded 60% of GDP to cut the excess amount by 5% per year for three
years or be fined.
Schaeuble’s letter suggested stronger sanctions, including
withholding EU development and agricultural funds, as well as voting
rights for repeat offenders.
The finance minister’s letter was also sent to EU Council President
Herman Van Rompuy, who heads a taskforce that is seeking to overhaul
existing EU fiscal rules.
— Frankfurt bureau: +49-69-720 142; email: frankfurt@marketnews.com —
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