Italy, pressed to boost defence spending, lashes at 'stupid' EU rules
Italy's Minister of Economy and Finance Giancarlo Giorgetti attends a press conference during the G7 Finance Ministers and Central Bank Governors' Meeting in Stresa, Italy May 24, 2024. REUTERS/Massimo Pinca/File Photo
ROME - European Union budget rules are "stupid and senseless" and need to be changed to allow member states to boost defence spending as recommended by Brussels, Italian Economy Minister Giancarlo Giorgetti said on Thursday.
The EU Commission has introduced flexibility clauses to allow more investment in security, but Giorgetti said their current form penalises countries such as Italy, which are under a so-called EU infringement procedure for their excessive deficits.
"It is essential to find ways to bring these rules up to date with the crisis we are experiencing so that they do not seem stupid and senseless," the minister said in a statement issued by his staff on the sidelines of a meeting with euro zone peers in Luxembourg.
The title of the statement was blunter, saying Giorgetti called for changes to "stupid and senseless rules".
Brussels has proposed allowing member states to raise defence spending by 1.5% of gross domestic product each year for four years without any disciplinary steps that would normally kick in once a deficit is more than 3% of GDP.
The plan came amid growing pressure in Europe to boost military spending to deter a potential attack from Russia and become less dependent on the United States.
Highly-indebted Italy is set this year to meet the NATO defence target of 2% of GDP through a series of accounting changes, but an alliance summit next week is expected to raise the goal to 5% of GDP.
Giorgetti said that, under the Commission's scheme, member states not subject to the EU's excessive deficit procedure would be allowed to use the extra leeway on defence without breaching budget rules, even if their deficits rise above the 3% of GDP ceiling.
However, "member states already in the infringement procedure cannot use the same flexibility," he added.
In this situation Italy is reluctant to use the EU flexibility clause because it would prevent it from lowering its deficit to 2.8% of GDP in 2026 from 3.4% last year, as planned.
"Italy is committed to a timely exit from the infringement procedure and accepting the invitation to increase defence spending would forever prevent this," Giorgetti said.
Rome is also wary of any move that could harm its improving reputation on financial markets, two government officials said.
Last month, credit ratings agency Moody's upgraded Italy's outlook to "positive" after rival S&P Global raised the country's rating to "BBB+" from "BBB."
Italy's preferred option would be the issuance of common EU debt to finance higher defence spending, one of the officials said, but such a plan would require support from the other bloc members. REUTERS
Join ST's Telegram channel and get the latest breaking news delivered to you.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
23 minutes ago
- Straits Times
Under pressure, officials in Western India move against abuse in sugar fields
Workers harvest sugarcane in a field in Kolhapur district in the western state of Maharashtra, India, on Nov 30, 2023. PHOTO: REUTERS Authorities in western India are taking steps to improve labor conditions for sugar cane cutters after a court ruling and an investigation by The New York Times and The Fuller Project highlighted serious abuses of workers. Journalists revealed in 2024 that women in the Indian state of Maharashtra were pushed to get unnecessary hysterectomies as a way to keep them working in sweltering sugar fields, unencumbered by menstruation or gynecological ailments. The sugar cane-cutting system also has used child labor, pushes young girls into marriage and locks families into debt bondage. The sugar industry is overwhelmingly controlled by the state's political leadership. And major Western brands like Coca-Cola and PepsiCo have profited from the system. Government officials, regulators and companies have for years done little or nothing to address these abuses. Politicians say that changing the labor system would cut into sugar profits and make it impossible for factories to compete. The Bombay High Court ruled in March that government must address these problems. And though the court has no direct enforcement power in this case, labor-rights groups say the ruling is important because it is the first official acknowledgment that the system in Maharashtra must change. The court ruled that migrant workers and the middleman contractors who hire them must be registered as a standard employee-employer relationship. That would close a loophole that has allowed sugar companies to deny any responsibility for the workers who cut their cane. The court also called for the abolition of a system known as koyta, in which husband-and-wife teams cut sugar cane, with the men frequently receiving and controlling all the pay for each family unit. If implemented, the changes could make sugar cane cutters eligible for a minimum wage, time off and other protections under Indian labor laws. Currently, the workers receive a loan at the beginning of each season, which they pay off through work. They have no days off and must pay a fee to leave work to see a doctor. For women, seeking routine gynecological care can mean falling deeper into debt to their contractors. Many postpone doctor visits or get hysterectomies as a drastic form of preventive care. The court also said that workers should have access to clean drinking water, electricity, cooking gas and sanitation facilities. Pepsi declined to comment, and Coca-Cola did not respond to a request for comment. NYTIMES Join ST's Telegram channel and get the latest breaking news delivered to you.
AsiaOne
32 minutes ago
- AsiaOne
Trump disavows spy chief Gabbard's take on Iran's nuclear program, World News
WASHINGTON - US President Donald Trump said on Friday (June 20) that his Director of National Intelligence, Tulsi Gabbard, was wrong in suggesting there is no evidence Iran is building a nuclear weapon. Trump contested intelligence assessments relayed earlier this year by his spy chief that Tehran was not working on a nuclear weapon when he spoke with reporters at an airport in Morristown, New Jersey. "She's wrong," Trump said. Gabbard testified to Congress in March that the US intelligence community continued to judge that Tehran was not working on a nuclear warhead. Trump's comments came as the president has said he would weigh involvement in the Iran-Israel conflict over the next two weeks. Israeli Prime Minister Benjamin Netanyahu has justified a week of airstrikes on Iranian nuclear and military targets by saying Tehran was on the verge of having a warhead. Gabbard's office has previously pointed to quotes from the spy chief saying that she and Trump were "on the same page" regarding the status of Iran's nuclear programme. Iran denies developing nuclear weapons, saying its uranium enrichment programme was only for peaceful purposes. A source with access to US intelligence reports told Reuters that the assessment presented by Gabbard had not changed. They said US spy services also judged that it would take up to three years for Iran to build a warhead with which it could hit a target of its choice. Some experts, however, believe it could take Iran a much shorter time to build and deliver an untested crude nuclear device, although there would be no guarantee it would work. [[nid:719150]] Trump has frequently disavowed the findings of US intelligence agencies, which he and his supporters have charged - without providing proof - are part of a "deep state" cabal of US officials opposed to his presidency. The Republican president repeatedly clashed with US spy agencies during his first term, including over an assessment that Moscow worked to sway the 2016 presidential vote in his favour and his acceptance of Russian President Vladimir Putin's denials. Gabbard, a fierce Trump loyalist, has been among the president's backers who have aired such allegations.
Straits Times
38 minutes ago
- Straits Times
Air India cuts international flights after crash causes chaos
Air India's decision came a day after Indian authorities directed the airline to improve its operations. PHOTO: REUTERS NEW DELHI – Air India, India's flagship carrier, said it would temporarily reduce the number of international flights it operates, after the deadly crash of one of its flights last week unleashed plane delays, unnerved passengers and prompted technical inspections of its fleet. The airline, which is grappling with the aftermath of the June 12 crash that killed at least 270 people, said late on June 18 in a post on the social media platform X that it was cutting international services on certain planes by 15 per cent at least until mid-July. The move, which applies to wide-body jets – planes with two aisles that are typically used for long-haul flights – is meant to 'ensure stability of operations, better efficiency and minimise inconvenience to passengers,' it said. Air India's decision came a day after Indian authorities directed the airline to improve its operations. The airline has been inundated by complaints from passengers about cancelled flights, faulty cabin devices and inadequate information being given to travelers. On June 17, India's Directorate General of Civil Aviation, the country's main civil flight regulator, said in a statement that it found no 'major safety concerns' as it conducted technical inspections of Air India's fleet of 33 Boeing 787 Dreamliner planes, the model of plane that crashed. So far, 26 of the airline's planes have been cleared, Air India said. However, the regulator did find 'maintenance-related issues' and directed the carrier to 'strengthen internal coordination across engineering, operations, ground handling units'. Air India has a fleet of 190 planes, a company spokesperson said late on June 19, though its website lists 128. Air India Group, including Air India Express, operates about 1,000 flights daily, including to dozens of overseas destinations. The carrier has cancelled more than 80 flights since the crash. NYTIMES Join ST's Telegram channel and get the latest breaking news delivered to you.
