Italy respected debt rule in 2017 - EC

(ANSA) - Rome, May 23 - The European Commission said in its recommendations for member States on Wednesday that Italy respected the EU's debt rule last year, meaning infringement proceedings will not be opened on this issue for now. European Commission Vice President Valdis Dombrovskis said that "we have decided not to open a debt procedure for Italy". However, the Commission said Italy's 2018 budget measures appear "inadequate to ensure compliance with the adjustment path towards" its medium-term budgetary objective (MTO). It said it will reassess compliance on the basis of the ex-post data for 2018 in spring 2019.
    Dombrovskis said Wednesday that Italy must work to keep bringing down its big public debt and approve a structural budget adjustment of 0.6% of GDP next year. "The political message for Italy is clear," he said. "You must continue to reduce the public debt, which is the second-highest (in the eurozone) after Greece. "But in our assessment, we see broad compliance with the Pact in 2017 and the debt rule.
    "We recommend that Italy continues to reduce its deficit and debt and, for 2019, we recommend a structural adjustment of 0.6%". There are doubts about whether the new government that the 5-Star Movement and the League are in the process of forming in Rome will abide by the EU's budget rules.
    The programme the M5S and the League have agreed on features measures that could cost tens of billions of euros, according to some experts.