EU to rule on German and French deficits

THE European Commission will make a decision on what to do about excessive budget deficits in Germany and France in November, spokeswoman Amelia Torres said yesterday.

The budget shortfall of Germany, which is the eurozone’s biggest economy by far, will exceed the European Union’s imposed ceiling of 3% of gross domestic product for a fourth year running this year.

Germany said that its budget gap this year would be some 3.7%, a figure unchanged from 2004, but the final shortfall will be somewhat closer to 4.0% after the European Union’s statistics office said that Germany cannot use the securitisation of future pension fund contributions to reduce the gap.