Wainwright Marks Management - EC to hold off on Italy's Disciplinary Procedure
June 27, 2019 (PRLEAP.COM) Business NewsItaly has been facing problems over its budget for next year and the European Commission has threatened to implement disciplinary measures against Italy whose debt burden is the second highest in the Euro zone. Earlier this month, the European Commission triggered a penalty procedure that could result in Italy being forced to pay billions of euros in fines for failing to adhere to the EU's spending rules.
Italy's populist government proposed that it would spend billions of euros as part of next year's budget. The funds would be spent on reducing income tax and overhauling the pension system. The government plans to introduce a minimum guaranteed wage for families who are struggling financially.
Matteo Salvini, deputy prime minister of Italy's current populist government, believes Italy needs such measures to stimulate its economy after years of austerity but the European Commission says the country cannot afford to implement such expensive measures. The European Commission has warned that Italy's proposed budget and failure to make necessary structural reforms could have a negative impact on the country's growth potential.
But analysts at Wainwright Marks Management say that the European Commission will likely hold off on proceeding with the disciplinary process this week and this will give Italy time to revise its budget plans.
Wainwright Marks Management analysts say no European Union member has even been subject to such disciplinary proceedings. Italy clashed with the European Commission just six months ago, averting penalties only narrowly by reaching a last minute compromise.