Italy hopeful of imminent budget deal with EU

By Giuseppe Fonte and Steve Scherer ROME (Reuters) - Italy said it hoped to clinch a deal with the European Commission later on Monday on its contested 2019 budget, hours after the government sent an amended version to Brussels. A deal would end weeks of wrangling between the Commission and Italy's coalition government, which is made up of the anti-establishment 5-Star Movement and the right-wing League. After Economy Minister Giovanni Tria cancelled a scheduled appearance at a book presentation on Monday evening, his spokeswoman said he was tied up in last-minute negotiations with Brussels and hoped for a deal before the end of the day

Reuters December 18, 2018 02:05:25 IST
Italy hopeful of imminent budget deal with EU

Italy hopeful of imminent budget deal with EU

By Giuseppe Fonte and Steve Scherer

ROME (Reuters) - Italy said it hoped to clinch a deal with the European Commission later on Monday on its contested 2019 budget, hours after the government sent an amended version to Brussels.

A deal would end weeks of wrangling between the Commission and Italy's coalition government, which is made up of the anti-establishment 5-Star Movement and the right-wing League.

After Economy Minister Giovanni Tria cancelled a scheduled appearance at a book presentation on Monday evening, his spokeswoman said he was tied up in last-minute negotiations with Brussels and hoped for a deal before the end of the day.

The Commission rejected Italy's expansionary draft budget in October, saying it would not lower the country's large debt and declaring it in clear breach of EU fiscal rules. Rome submitted a revised plan last week with a lower deficit.

As part of the new plan, Rome is lowering its forecast for economic growth next year to 1 percent from 1.5 percent, a government source and a Commission source told Reuters on Monday.

The coalition sat down to a marathon meeting on Sunday evening to hammer out the details of a possible compromise, but few details emerged and there was no indication that Rome was willing to further lower its deficit target.

Italy's original budget proposal envisaged a deficit equal to 2.4 percent of gross domestic product in 2019, up from 1.8 percent this year. The revised plan presented last week lowered that to 2.04 percent.

"We are optimistic" that the EU won't open a disciplinary procedure, economy ministry undersecretary Massimo Garavaglia said on Monday in an interview with state-owned radio RAI.

The so-called "excessive deficit procedure" threatened by the European Commission, the European Union executive, could eventually end in fines, though these have never been levied on any EU member state.

Time is running out fast to finalise the 2019 budget law, which must be passed in both houses of the Italian parliament by the end of the year.

The ruling parties insist that any deal with Brussels must not prevent their flagship reforms - income support for the poor and a lower retirement age.

However, League leader Matteo Salvini and 5-Star chief Luigi Di Maio have said savings will come from revisions to both measures, mainly by launching them no earlier than March, instead of from the start of 2019.

Included in the budget are measures to raise taxes on luxury cars in order to provide incentives for electric and hybrid models, the coalition parties agreed on Sunday.

(Additional reporting by Gavin Jones and Giselda Vagnoni; Editing by Daniel Wallis and Mark Heinrich)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.