December 4, 2018 / 4:45 AM / 8 days ago

Euro zone ministers say Italy must reduce debt

FILE PHOTO: European Union and Italian flags are seen in downtown Rome, Italy, October 19, 2018. REUTERS/Alessandro Bianchi

BRUSSELS (Reuters) - Euro zone finance ministers said on Tuesday Italy’s draft 2019 budget was breaking European Union rules and they agreed with the European Commission that Rome should amend it.

Italy, which already has the second highest debt in Europe at 133 percent of GDP, wants to borrow and spend more to deliver on election promises, breaking EU rules that say debt has to fall every year until it is below 60 percent.

The Commission, which is the guardian of EU rules, said last month Italy was in breach of EU rules and should change the draft budget or face a disciplinary procedure that could end up in fines.

“We support the Commission assessment and recommend Italy to take the necessary measures to be compliant with the SGP. We also support the ongoing dialogue between the Commission and the Italian authorities,” the ministers said in a statement.

Reporting By Jan Strupczewski; editing by Darren Schuettler

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