Press Release: Commission assesses Belgium’s stability programme and Poland’s convergence programme; recommends abrogation of EDP for Poland

The European Commission assessed the updated stability programme of Belgium and the updated convergence programme of Poland. Belgium was encouraged to meet its objective of a balanced budget in 2008 and achieve its medium-term objective (MTO) of a general government surplus of 0.5% of GDP in structural terms by 2009. Although it had reduced government debt substantially over the past 15 years, Belgium remained at medium risk as regards the long-term sustainability of public finances, which needs to be addressed by achieving high structural primary surpluses as well as by implementing structural reforms. In Poland, the government deficit was reduced significantly below the reference value of 3% of GDP in 2007 and is projected to remain below this ceiling also in 2008 and 2009. For this reason, the European Commission recommended that the Council abrogate the excessive deficit procedure (EDP) for Poland. However, progress towards the achievement of the MTO envisaged in the convergence programme, a structural deficit of 1% of GDP, is too slow given the favourable growth conditions. Poland was therefore encouraged to strengthen the pace of its budgetary consolidation in 2008 and beyond, which should also help containing inflationary pressures. Poland remains at low risk as regards the long-term sustainability of public finances.