Yesterday, EU finance ministers accepted the European Commission’s recommendations and asked Greece to correct its deficit by 2012 while underscoring that additional measures may be necessary to meet its 2010 deficit correction targets. The chair of the Council meeting, Elena Salgado, Spain’s Vice-President and Minister of Economy and Finance, also stated that, “if necessary Greece will receive any aid it requires and that is our firm commitment,” but was careful to add that the Greek government had not yet requested any financial aid.

Greece’s updated stability program sets 2012 as the date for reducing the deficit below the 3% reference value, and sets a target of 8.7% of GDP for its 2010 budgetary deficit, which represents a 4 percentage points reduction from the estimated 12.7% deficit for 2009. ECOFIN endorsed this time schedule, and the application of “wide-ranging structural reforms.” The Council set numerical limits to Greece’s government deficits and to annual changes in its consolidated gross debt in 2010, 2011 and 2012, and called on Greece to implement specific budgetary consolidation measures, including those presented in its stability program.

The Council is requiring Greece to present a report by March 16, 2010, setting out the timetable for implementing budgetary target measures for 2010, and another report by May 15, 2010 outlining the policy measures needed to comply with the Council?s decision, with quarterly reports following thereafter.

Greece has been the subject of EU excessive deficit procedure since April 2009, when the Council also issued a recommendation on corrective action to be taken. In December 2009, the Council concluded that Greece had failed to comply with its recommendation, which was followed, in January, by European Commission criticisms of Greek fiscal statistics.