Solbes declares Stability Pact working as he takes errant EU states to task

THE Stability and Growth Pact is working, Economics Commissioner Pedro Solbes insisted as he handed out warnings and started proceedings against six EU States.

His revision downwards of growth for the eurozone to 1.7% from 1.8% led to a drop in the value of the euro against the dollar.

The number of countries exceeding the 3% budget deficit limit set by the pact accounts for more than 75% of the union's economy. Portugal had reduced its excessive deficit and countries were making efforts to keep within the constraints of the pact.