Remarks by J.Dijsselbloem following the afternoon session of the Eurogroup meeting of 5 December 2016

Good afternoon and welcome to this first of two press conferences, because we will have the regular Eurogroup meeting directly after this. This was a dedicated Eurogroup to discuss the draft budgetary plans as we do every year. This afternoon we will turn to Greece and a few other issues.

This morning we welcomed Professor Niels Thygesen. He is the first chair of the newly created European Fiscal Board. Professor Thygesen is a distinguished economist with a long career both in academia and public service, in Denmark and internationally. He briefed us on the setting up of the European Fiscal Board, the role they will be playing and the cooperation they will have with the Commission and with us. We look forward to working with him.

On the draft budgetary plans I can be brief. We have issued a statement, I hope you have it.

The economic and budgetary situation in the euro zone i as a whole has steadily improved. Growth is forecast in every member state and will continue to strengthen in the coming years. Almost all member states are forecast to respect the treaty reference value of 3%. Debt has also started to come down, although the level of debt remains high, very high in some countries, and sustainability of public finances remains a matter of concern.

We agreed today that the fiscal stance should strike a balance between economic support and budget sustainability, in line with the requirements of the Stability and Growth Pact (SGP). We need to be mindful for the need to support the fragile recovery. We agreed that some member states can, if they choose to do so, use their favourable budgetary situation to strengthen their domestic demand and growth potential.

We also reviewed the individual draft budgetary plans of all member states, based on the Commission opinions. We agreed with the Commission assessment on the three groups of member states:

In the first group, we see Germany, Estonia, Luxembourg, Slovakia and the Netherlands. They have all submitted draft budgetary plans that are compliant with the pact so discussions on those countries were rather brief.

In the second group, we agreed that France, Ireland, Latvia, Malta and Austria have submitted draft budgetary plans that are broadly compliant. These member states will be vigilant in their budget execution in the coming year to ensure compliance.

In the third group, we agreed that Belgium, Italy, Cyprus, Lithuania, Slovenia, Finland, Spain and Portugal have submitted draft budgetary plans that risk non-compliance. We've listened in detail to the commitments made by the colleagues to implement measures to ensure that the their budgets will be compliant with the rules of the Stability and Growth Pact.

Regarding Italy, our colleague, Pier Carlo Padoan, could not attend today's meeting for understandable reasons. After yesterday's referendum we will await the political developments in Italy. I spoke to him this morning and we agreed that, at this juncture, it is difficult for the Italian government to commit now to take additional measures. Therefore the Eurogroup invites Italy to take the necessary steps in the nearby future to ensure that the budget will be compliant with the requirements of the SGP.

The new governments in Spain and Lithuania will submit updated draft budgetary plans soon and after the Commission has established an opinion we will review them in due course.

Thank you.