Press Release: Commission assesses stability programmes of Belgium and Spain

Having examined their updated stability programmes, the European Commission finds that Belgium and Spain have sound budgetary objectives for the medium term (so-called Medium-Term Objectives or MTOs). Spain plans budgetary surpluses throughout the programme period (2005-2009) and Belgium is expected to meet its objective of a structural surplus of 0.5% of GDP. All things considered, Spain's budgetary strategy provides a good example of a sound fiscal policy conducted in compliance with the Stability and Growth Pact. Belgium's continued reduction of its still high debt is also an example of fiscal policy in compliance with the Pact, but there are risks to the achievement of budgetary targets. This makes it particularly important that the 2007 budgetary target be met and the pace of adjustment be strengthened in the following years. As both countries, and Spain in particular, face a strong projected increase in age-related expenditure, they are encouraged to improve the long-term sustainability of their public finances by measures to reduce the cost of ageing.