The European Commission on Wednesday proposed to the Council to close Greece’s excessive deficit procedure (EDP), a red-flag label for countries in breach of EU budget deficit rules.
In announcing the recommendation on Wednesday, Pierre Moscovici, the Commission’s chief for economic and financial affairs, said, “this is a very symbolic moment for Greece … today’s proposal by the European Commission is recognition of the massive reduction of Greece’s fiscal deficit, to below the euro area average.”
EU finance ministers still need to sign off on the decision before Greece is in the clear.
The announcement came just days after Athens received €7.7 billion from its EU creditors as part of its bailout program. The Commission’s recommendation on the EDP is an acknowledgement of Greece’s recent economic turnaround, which has seen its general government surplus reach 0.7 percent of economic output last year from a deficit of 15.1 percent in 2009.
EU rules demand that governments keep their budget deficits within 3 percent of gross domestic product. Their public debt should also stay below 60 percent of GDP.
Three bailout programs later, economic forecasts are beginning to look rosier for Greece. The Commission, for example, expects to see the Greek economy expand by 2.1 percent this year, and 2.5 percent in 2018.
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