European Union Summit First Results
Only 23 out of the 27 EU nations agreed to join the new treaty which implies giving up some sovereignty of the fiscal policy and towards closer fiscal integration.
The main points of the statement produced after the night of negotiations are:
- Participants of the treaty will need to have balanced budgets with structural deficit which doesn’t exceed 0.5% of the GDP (this requirement must be included in the constitutions of the member states);
- In case the rule mentioned above is breeched, the unspecified “automatic correction mechanism” will be activated;
- Countries with deficits of more than 3% of the GDP will face sanctions;
- Member nations will have to submit their national budgets to the European Commission, which will have the authority to ask for revisions. Member states will have to report in advance how much they plan to borrow.