Six European prime ministers said today the European Union needs to stick to sound budget policies and urged further reforms to meet the goal of becoming the world's most competitive economy by 2010.
Their comments were made in a letter to EU president Ireland and the head of the European Commission ahead of the bloc's March EU summit. The Commission is also to discuss this week how to revamp the bloc's Stability and Growth Pact budget rules.
"Our commitment to sound budget policies should not be questioned. The Stability and Growth Pact is an essential element of economic governance . . . and a necessary condition to sustained economic growth," said the letter, a copy of which was obtained by Reuters.
"Its [the pact's] rules must be applied consistently and in a non-discriminatory basis."
The letter was signed by the prime ministers of Portugal, Estonia, Poland, Italy, The Netherlands and Spain. Poland and Estonia are among the ten accession states due to join the EU on May 1st.
The Stability Pact has come under increasing pressure after EU finance ministers effectively froze its implementation last year by waiving the rules for France and Germany, whose budget deficits have repeatedly breached the limit of three percent of GDP.
The European Commission has gone to court to test the legality of the EU finance ministers' decision, but is this week due to discuss how the pact can be applied in more flexibly.
This is expected to include taking into account debt levels as well as deficits and insisting that countries stick to the pact's rules in good economic times as well as bad.
The Stability Pact is expected to be one of the main topics to be discussed at the March 25-26 EU summit in Brussels.
The six leaders also called for the summit to discuss such issues as employment, innovation, research and development and market regulation.