European Commission ‘not buying into’ deficit reduction claims – Labour

Labour MPs Charles Mangion and Gavin Gulia said the latest report from the European Commission on the Maltese economy has played down statements by Lawrence Gonzi that he would be able to reduce the government deficit.

The Prime Minister has forecasted he will bring down Malta’s deficit to some 1.2% of gross domestic product, but Labour said the EC report is predicting that the deficit will in fact increase.

“The EC believes debt will increase because we are already paying more interest on debt than recurrent spending on education, health and new roads. The EC report predicts a downturn in economic growth, higher inflation, even higher than the EU average,” the two MPs said.