Budget incompatible with debt cut - EC

High debt still 'crucial vulnerability'

(ANSA) - Rome, October 30 - The Italian budget for 2019n is incompatible with the reduction of debt that at over 130% of GDP is still a "crucial vulnerability," the European Commission told Italy Tuesday.
    In the letter, EC economic and financial affairs directorate Director General Marco Buti writes that "Italian public debt remains a crucial vulnerability".
    Writing to Treasury Director-General Andrea Rivera, he says "such a high public debt limits the government's room to manoeuvre for more productive spending to benefit its citizens".
    Buti also says the high debt remains a concern for the eurozone.
    He says the 2019 budget plan is "incompatible with a debt reduction".
    The economy ministry said earlier it had received a new letter from the European Commission asking for "a report on the so-called 'significant factors' that may justify a debt/GDP ratio with a less marked reduction than that requested," the ministry said Tuesday.
    It said "the reply must be sent by November 13".
    A similar letter was sent in past years, the ministry said.
    The reply "will be sent to Brussels respecting the deadline indicated", it said.
    The Treasury said the reply would justify the trajectory of debt reduction outlined in the Budgetary Planning Document.