US EditionBrussels Rebukes Finland for Breaching EU Budget Rules
The European Commission cited Finland's 4.5% GDP deficit, high debt, and weak growth caused by geopolitical risks and social spending in recommending an excessive deficit procedure.
- On Tuesday, the European Commission formally reprimanded Finland and recommended opening an excessive deficit procedure that could lead to financial penalties.
- Amid weak consumption and revenue shortfalls, weak consumption limited VAT revenue and high unemployment of 9.8% compounded strain, while Helsinki's land border closure with Russia reduced tourism, Finance Minister Riikka Purra noted last week.
- The Commission's data reveal Finland's debt is near the eurozone average , GDP growth has slowed from 0.4% in 2024, and European Commissioner Valdis Dombrovskis noted the deficit was 0.9% in 2022.
- Brussels will tell Helsinki in December how quickly it must correct the deficit, despite Finland invoking the national escape clause allowing 1.5% of GDP on defence this year.
- Putting Finland's case in context, the Commission noted Russia's war in Ukraine has sapped investor and consumer confidence, producing anaemic growth, while nine other member states face EDPs for breaching the EU's 3% fiscal threshold.
20 Articles
20 Articles
Finland placed under EU deficit procedure over rising debt
Finland will be placed in the European Union’s excessive deficit procedure (EDP) after the European Commission confirmed the country is breaching the bloc’s core economic rules on debt and budget deficits. The Commission announced the proposal this week following new data showing Finland’s budget deficit has exceeded 3 percent of GDP and its debt level is forecast to rise above 90 percent next year. The EDP aims to ensure that member states comp…
Finland threatens consequences due to its budgetary management: The level of new debts is clearly too high for the EU Commission - it is therefore threatening an excessive deficit procedure. Germany is spared from this despite new billion credits.
The European Commission announced today that Finland will be added to the list of countries violating EU fiscal rules after confirming that its deficit will remain above three percent of gross domestic product in 2025.
Because Finland is making too many debts, the EU is starting proceedings against the Member State. This would also threaten Germany if there were not an exception rule.
An excessively large budget deficit places Finland in the EU's economic corner of shame. Unemployment and national debt are also growing.
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