The European Commission has insisted that the EU's Stability and Growth Pact is the cornerstone of the euro economy, despite proposing a delay in a key deadline.
The comment by Jonathan Faull, spokesman for Commission President, Romano Prodi, came after the Commission admitted yesterday that the deadline for the 12 eurozone countries to balance their budgets by 2004, was no longer feasible.
The Commission proposed delaying the deadline until 2006, a proposal that will be considered by finance ministers at a regular meeting next month.
Meanwhile, Economic and Monetary Affairs Commissioner, Pedro Solbes, today urged four deficit-hit eurozone countries to make more fiscal efforts rapidly to help save the foundations of the euro.
The four states - France, Germany, Italy and Portugal, have been singled out by Brussels for letting deficits widen.
The German government this morning increased its estimate of its deficit ratio this year to 2.9% of GDP, from a previous 2.5%. The limit laid down by the pact is 3%.
Meanwhile, France announced its 2003 budget today, forecasting a deficit of 2.6% of gross domestic product - the same level as it expects this year.
Mr Solbes also said a spring forecast from the European Commission of average eurozone growth of 1.4% was now out of reach. He added that the average growth rate for 2002 was unlikely to exceed 1%.
