Greece, Romania, Poland and Lithuania are asking the European Commission for “special treatment” in terms of debt rules for defense spending to help cover military investment required after Russia’s invasion of Ukraine.
According to a document cited by the Reuters news agency, EU finance ministers will begin discussions on Saturday on how fiscal rules should be changed to adapt them to the post-pandemic reality of high public debt and large investments needed to combat climate change.
Addressing national security risks
In a paper prepared for the meeting, the four countries argue that EU rules, originally designed to limit government borrowing to preserve the value of the euro, should also help address risks to sovereignty and territorial integrity of the EU.
“Caring for the common good, which is freedom and broadly understood security, requires an immediate change in the treatment of individual member states’ defense spending,” the four countries wrote in their joint report, revealed by Reuters.
Germany is opposed to singling out individual sectors that should receive special treatment in the rules, but the Commission has shown some understanding of such an approach.
“It is time to include defense spending in this picture,” French Internal Market Commissioner Thierry Breton said earlier this week, adding that discussion of changes to EU debt rules should be “no taboo”.
Huge deficit
“Since the creation of the eurozone, European countries have accumulated a deficit of 1.3 trillion euros in defense spending compared to the target of 2% of GDP (of spending required by NATO membership),” Breton said, referring indirectly except clearly to Germany, which has long fallen short of NATO’s requirement.
“If every country had met its defense investment targets, its debt levels would have increased by at least twelve percentage points of GDP,” he said.
The paper also stresses that in the short term, considering disciplinary measures against a country running a deficit above the 3% of EU GDP threshold, the Commission should consider the country’s defense spending as a mitigating factor.
In the long term, the EU should introduce a deficit exemption, like the one introduced in 2011 to implement the pension reforms, he says.
Latest News
Iran Activates Air Defense System- Reports of Attack by Israel
An Iranian official said explosions reported by Iran's media were the result of the activation of the country's air defense system, yet media reports attribute them to a drone attack by Israel
Poll: Greeks, EU Citizens Eager to Vote in European Elections
EU citizens are eager to vote in the upcoming elections for the European Parliament in June, with eight in 10 saying the current geopolitical situation makes voting imperative
Mitsotakis-Erdogan Meeting in Ankara Fixed for May 13
The Greek PM himself made the announcement from Brussels on Thursday, while he also responded to a question on Athens' intent to create a marine park in the central Aegean, an environmental initiative
Greece Aims to Boost Energy Capacity, Economy with Offshore Wind Farms
Greece’s Energy Ministry is pushing legislation to accelerate the construction of the first floating wind farms in Greek seas
Reuters: Greek Economy Surges After Decade of Pain
Nevertheless, the article also highlights some of the challenges facing the country, with a falling birthrate and labor shortages posing a threat to the long-term outlook
IMF: Greek Growth in 2024 at 2%; Debt to Ease to 158.8% of GDP This Year
Projected consumer prices are forecast to rise by 2.7%
Major Increase in Russian Natgas Imports by Greece in 1Q 2024
Russian state natgas exporter Gazprom dominated imports to the country, mostly through the overland pipeline entering via a northern frontier pipeline
Lamda Development Announces First Profitable Year for The Ellinikon Project
The ATHEX-listed developer reported 206 million euros in EBITDA for FY23, a 69%-percent increase from 2022 results
Europa Nostra Adds Sifnos, Serifos, Folegandros to Most Endangered List
Europa Nostra says three Greek islands are at risk due to surge in tourism development and rampant construction
EU Cracks Down on Social Media Influencers Making Illegal Profits
A recent EU inquiry uncovered 358 online influencers, among them 20 in Greece, found to be violating consumer laws