EU commission urges legal action against over debt

Italy Europe Economy

Italian Deputy Premier and Interior Minister, Matteo Salvini, speaks during a press conference at the Senate in , Thursday, May 30, 2019. Salvini said that he was confident the government's reply to a letter from the European Commission about its fiscal policy will avert the opening of an infringement procedure. "This morning I had an hour and a half of talks with the Economy Minister (Giovanni Tria) about the letter, which we will respond to politely with positive numbers that will shelter us from other letters or infringement procedures," the League leader told. (Claudio Peri/ANSA via AP)

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BRUSSELS (AP) — The European Commission recommended Wednesday that legal action be launched against because it failed to respect EU debt rules last year and is likely to do so again in 2019 and 2020, setting up a new confrontation with the populist government in .

In coming weeks, EU member states must assess the extent of any action that should be taken . It could face billions of euros (dollars) in fines.

A new commission report showed that 's public debt stood at 132.2% of GDP in 2018, far above the EU's 60% limit.

"Moreover, is not projected to comply with the debt reduction benchmark in either 2019 or 2020 based on both the government plans and the commission 2019 spring forecast," the report said.

The action comes at a time of rising tensions between Brussels and the Italian government, in particular Deputy Premier Matteo Salvini, who has been emboldened by his right-wing League party's strong gains in last month's EU elections.

The Italian government only won commission approval for its 2019 budget plan late last year. After some early defiance from Salvini, agreed to reduce the deficit to acceptable levels.

Commission Vice-President Valdis Dombrovskis noted on Wednesday that "we are not opening the excessive debt procedure. First, EU member states have to give their views" on the report. He said the EU's economics and finance committee has two weeks to draw its conclusions based on the report.

EU Economy Commissioner Pierre Moscovici extended a hand to , saying: "My door is open. We can always discuss and listen."

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