"I expect a positive European Commission report, given that Croatia has submitted its documents. However, that's not the end. There's plenty of time ahead for us to correct the macroeconomic imbalances, which we will work on in 2015, 2016 and 2017 with regard to the deficit. This is just a small step towards a full fiscal consolidation that needs to follow in the years ahead," Lalovac said in Brussels, where he attended a meeting of European Union finance ministers.
Lalovac said he spoke with Economic and Financial Affairs Commissioner Pierre Moscovici on the fringes of the meeting, but that he could not speak of any details. "The Commission has a meeting tomorrow and I hope for a positive solution. I don't expect corrective measures, but that doesn't mean we can relax. Strong monitoring will certainly continue. The Commission will certainly insist on the implementation of specific recommendations."
Tomorrow, the Commission will adopt the evaluations of each member state's national reform programme and give specific recommendations on economic policies in the period ahead for each member state. It is also expected to adopt a decision on the Macroeconomic Imbalance Procedure (MIP).
The Commission found in February that Croatia, Bulgaria, France, Italy and Portugal have excessive macroeconomic imbalances. The MIP could be launched against Croatia and France if the Commission evaluates that the measures the two countries have announced in their national reform programmes are insufficiently ambitious.
The Commission grades the imbalances in six categories and Croatia is in the fifth, which covers countries with excessive imbalances that demand specific surveillance and resolute political action.
The MIP has not yet been imposed on any member state. It calls for the drafting of a corrective action plan, which is then assessed by the Commission. If it is not satisfied, the Commission asks for a new one. If the second one is not satisfactory either, euro area countries can be fined up to 0.1 percent of GDP while other countries can have part of the European funds at their disposal suspended.
(HINA)