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Spain may get extra year to cut deficit - EU's Rehn
May 30, 2012 / 12:42 PM / 6 years ago

Spain may get extra year to cut deficit - EU's Rehn

BRUSSELS, May 30 (Reuters) - The European Commission is ready to give Spain extra time to bring its budget deficit down to 3 percent of GDP, if Madrid presents a solid budget plan for 2013 and 2014, EU Economic and Monetary Affairs Commissioner Olli Rehn said.

Spain had a budget deficit of 8.9 percent in 2011 but it plans to cut it to 5.3 percent this year and 3 percent in 2013 - as agreed with euro zone finance ministers. But those goals are widely seen as optimistic with the country in recession.

Unless Spain is formally granted an extension of the 2013 deadline, it could face fines. But Rehn indicated that some wiggle-room could be granted to Spain if it can come up with a multi-year plan on how it will reduce its deficit.

“On condition that Spain can effectively control the excessive spending, especially by the autonomous regions, and assuming that Spain will present a solid 2-year budget plan for 2013 and 2014 ... we are ready to consider proposing an extension of the deadline to correct the excessive deficit,” Rehn said, with the deadline pushed out by one year from 2013.

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