"Big differences" remain between Portugal, EU on 2016 budget

Portugal and the European Union are struggling to find common ground on the country's budget for this year, with an EU spokeswoman saying on Monday that "big differences" remain between the two sides.

Eurozone member states have to submit their draft budgets to the European Commission every year for scrutiny. The EU's executive can request any plans it deems inappropriate to be redrawn, under budget discipline rules that are meant to spot financial trouble early on.

Portugal was supposed to submit its draft 2016 budget by October 15, but missed the deadline after elections that saw Prime Minister Pedro Passos Coelho's alliance lose its absolute majority in parliament.

Passos Coelho was later toppled in a no-confidence vote and replaced as premier by Socialist Party leader Antonio Costa. The new government then submitted the 2016 draft budget to the commission.

"There are big differences and we're working with the Portuguese authorities to close the gap," commission spokeswoman Annika Breidthardt told journalists in Brussels on Monday.

The process is part of the EU's enforcement of broader rules that require public deficits in member states to be limited to 3 per cent of gross domestic product (GDP) and public debt to be no higher than 60 per cent of GDP.

The EU has the power to issue sanctions against eurozone countries that fail to respect those deficit and debt rules.

Portugal's economy returned to growth in 2014, three years after receiving a 78-billion-euro (85-billion-dollar) bailout programme from the eurozone and the International Monetary Fund. The country has the third-largest public debt in the EU.

Last update: Fri, 24/06/2016 - 08:49
Author: 

More from Europe

One dead after central Italy hit by series of quakes

One person was killed on Wednesday when a building collapsed during four powerful quakes that shook central Italy on...

Boris Johnson compares French president to WWII prison guard

British Foreign Secretary Boris Johnson on Wednesday compared Francois Hollande to a World War II prison guard after...

Merkel pledges to hold Europe together after Brexit

German Chancellor Angela Merkel pledged on Wednesday to hold the European Union together after Britain's planned...

Slovenia looks to capitalize on its connection to Melania Trump

As Donald Trump campaigned for the Oval Office, his Slovenian-born wife Melania did not receive much love and...

EC recommends Croatia's gradual integration into Schengen Information System

The European Commission on Wednesday made a recommendation to the Council of the European Union to gradually...