Sunday, August 14, 2011

EU chief welcomes Italian austerity plan

President of the European Union Herman Van Rompuy

Source: Press TV

President of the European Union Herman Van Rompuy has welcomed Italy's adoption of new austerity measures, saying they are “crucially important” for the entire eurozone.

"I fully support and welcome the timely and rigorous financial measures [in Italy]. I underlined that these approved measures are crucially important not only for Italy but for the Eurozone as a whole," Van Rompuy said in a statement after speaking with Italian Prime Minister Silvio Berlusconi on Saturday, the state-funded BBC reported.

The remarks come two days after Italian government approved an additional austerity program worth 45 billion euros.

The measures include a solidarity tax on high earners, cuts in local government budgets and a reduction in government spending.

The cutbacks fulfill some key demands from the European Central Bank (ECB).

The ECB bought up Italian government bonds this week to help reduce borrowing rates.

Earlier, trade unions in Italy expressed their worries against the government's tougher economic measures, and threatened to stage a general strike should the government go ahead with its planned austerity cuts.

The new austerity measures come on top of a 48-billion-euro package agreed in July, when Rome first came under overwhelming pressure from investors.

The austerity package will go before Italy's parliament for final approval.

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