June 22, 2018 / 11:40 AM / a month ago

Italy aims to respect EU call for 2018 budget correction: minister

LUXEMBOURG (Reuters) - Italy intends to accept a request from the European Commission for additional belt-tightening measures to lower this year’s budget deficit, but recent economic developments will also be taken into account, its economy minister said on Friday.

Italian Economy Minister Giovanni Tria attends as Prime Minister Giuseppe Conte (unseen) speaks during his first session at the Lower House of the Parliament in Rome, Italy, June 6, 2018. REUTERS/Tony Gentile

“The intention is obviously to try to respect (the request),” Giovanni Tria told reporters at a meeting of European Union finance ministers in Luxembourg. “There could be some slight deviation,” he added, due to the fact that the economy is now slowing down.

The Commission has asked Italy to lower its structural deficit - adjusted for the business cycle and one-off items - by an additional 0.3 percentage points of gross domestic product this year.

In other remarks, Tria said proposals from France and Germany for reforms of euro zone economic governance had received a mixed reception from other European governments.

In particular, Italy was concerned that a possible reform of the role of the European Stability Mechanism “could create market turbulence,” he said.

The minister also said Italian state holding company Cassa Depositi e Prestiti (CDP) should “remain outside the state sector” for the purposes of public finances.

reporting by Francesco Guarascio, writing by Gavin Jones

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