Federal Finance Minister Christian Lindner is actively seeking allies to reform the Stability Pact and prevent the weakening of Brussels’ debt rules. During a finance ministers’ meeting, Lindner and his French counterpart, Bruno Le Maire, appeared to be in general agreement on the importance of stable government finances and increased investment for innovation. They both expressed the intention to have the reform in place by the end of the year.
Christian Lindner highlighted the consensus among ministers in Santiago de Compostela regarding the necessity of realistic and reliable fiscal rules, the restoration of fiscal buffers, and the promotion of investment.
What is the Stability Pact?
The Stability and Growth Pact (SGP) is a set of fiscal rules that were adopted by the European Union (EU) in 1997. The SGP is designed to ensure that EU member states maintain sound public finances and avoid excessive deficits and debt levels.
Why is Lindner seeking to reform the Stability Pact?
Christian Lindner believes that the SGP is too inflexible and that it needs to be reformed to take into account the current economic challenges facing the EU. He has argued that the SGP should allow for more flexibility in terms of public investment and that it should take into account the specific circumstances of each member state.
Federal Finance Minister Christian Lindner
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What are the chances of success?
It is unclear whether Lindner will be successful in his efforts to reform the Stability Pact. There is a great deal of divergence of views among EU member states on the need for reform. However, the fact that Lindner has the support of France is a positive sign. France is one of the largest and most influential member states in the EU.
Source: Handelsblatt