Spain confident EU will agree new fiscal rules by year-end

Spain, which holds the rotating presidency of the European Union, is confident that the 27-nation bloc will reach a deal on new fiscal and debt rules this year, Spanish Finance Minister Nadia Calvino said on Wednesday.

The rules, which underpin the euro currency by setting limits on government borrowing, have been suspended since 2020 to allow greater public spending during the pandemic and then the energy crisis, but are to be reinstated from 2024.

They are now under review to adapt them to the new realities of high public debt and large investment needs. Officials say work is progressing, but there are some fundamental differences between France and Germany on their future shape.

Italy’s Finance Minister Giancarlo Giorgetti said last week these differences mean that a deal was unlikely by the end of this year, as planned. But Calvino disagreed.

“I am quite confident we can find an agreement,” Calvino said at a Bruegel think tank conference. “There is a unanimous acknowledgement that we need to have them in place by the end of the year.”

She said EU finance ministers would discuss changes to the rules at their meeting next week, focusing on how to cut debt in a sustainable way while financing the investment to transform economies to become more green and digital.