The EU Commission presented its legislative proposals on 26 April 2023 to implement the most comprehensive reform in the EU's economic governance rules after the economic and financial crisis. The main aim of these proposals is to strengthen the sustainability of public debt while promoting sustainable and inclusive growth in all Member States through reforms and investments. With these legal amendments, the increasing public debt ratios in member countries will be reduced in a realistic, gradual and sustainable manner.
The main element in reducing the public debt will be the national medium-term fiscal structural plans. Member States shall prepare plans that set out their fiscal targets, measures to address macroeconomic imbalances and priority reforms and investments over a period of at least 4 years. The plans evaluated by the Commission will be approved by the European Council. At the end of the period covered by the plan, the ratio of public debt to GDP will need to be lower than at the beginning of that period. For each country with a budget deficit of more than 3 percent or a public debt of more than 60 percent, the Commission will publish a country-specific technical roadmap, which will ensure a reasonable debt reduction.
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