Ink Barely Dry on Finance Ministers’ Deal, Trichet Calls Europe’s New Fiscal Rules Weak |
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March 16, 2011
European Union finance ministers agreed on Tuesday to toughen the fiscal rules for euro zone governments, only to have the proposals dismissed as “insufficient” by the president of the European Central Bank, Jean-Claude Trichet.
European Union finance ministers agreed on Tuesday to toughen the fiscal rules for euro zone governments, only to have the proposals dismissed as “insufficient” by the president of the European Central Bank, Jean-Claude Trichet. The agreement was the culmination of months of debate on how to strengthen the Stability and Growth Pact, which sets out fiscal guidelines for the 17 countries that use the euro currency, but which has been ignored by several countries and did not prevent the sovereign debt crisis. The accord on six legislative proposals was the latest effort to restore confidence in the euro by extending economic and fiscal policy coordination and imposing sanctions on governments that fail to rein in excessive budget deficits and debt. The initiatives include an annual process under which budgetary policies of the countries involved will be reviewed to detect emerging imbalances.
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