Padoan says Italy following budget rules, will reduce debt

Economy minister not interested in president's job

(ANSA) - Brussels, January 27 - Economy Minister Pier Carlo Padoan on Tuesday said that Italy was not in violation of European Commission budget rules and said the country was making every effort to reduce its massive debt.
    "I know there is the perception that Italy is breaking the rules but look carefully at the figures, it's not true," said Padoan said in an appearance before the European Parliament.
    "We stick to the rules better than others despite the high debt, which we are making every effort to keep on a path of reduction," he added. Italy is also introducing structural reforms "to strengthen sustainability" of economic growth.
    Padoan's comments came as an apparent indirect response to an earlier declaration by his German counterpart Wolfgang Schaeuble on whether the EC should apply flexibility in assessing the annual budgets of member States.
    "Flexibility is not negative per se but it must not lead to a situation where the agreed rules are not respected," Schaeuble said.
    "Then it would be wrong and would destroy confidence," of financial markets in the sustainability of eurozone budgets, the German economy minister added.
    Meanwhile, Padoan said Tuesday that EC officials "appreciate" the reform efforts Italy is making to improve its economy and encourage growth. Talks with EC officials examining Italy's 2015 budget show they also understand "the exceptional circumstances" created by years of economic weakness, Padoan said. Italy has not seen any real growth since 2008 while unemployment and business failures have increased and inflation fallen at times below zero. Still, Padoan predicted that times will get better and economic growth will help Italy to pay down its massive debt of more than two trillion euros - more than 130% of GDP - beginning next year.
    "We respect the rules, we are one of the EU countries that doesn't go over the (budget) limits," Padoan told Sky news. "From 2016, the debt will be on a downward path, guaranteeing stability". The EC last year deferred a decision on whether to approve Italy's 2015 budget until March, expressing concerns about the lack of debt-reduction measures.
    But Padoan said Rome had already given the EC details of his "sufficient" efforts to bring the public debt down, adding that he was "confident no further (budget) adjustments" will be needed.
    Efforts will be helped by the European Central Bank's quantitative easing programme, which is the right springboard for a new EU-wide push for growth and jobs, Padoan said.
    He also laid to rest any rumours he might be interested in running to replace Giorgio Napolitano as Italian president.
    "I have so much to do as minister," Padoan said.


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