As EU leaders agree a new treaty to enforce budget discipline, two countries have announced that they will miss the agreed budget deficit targets set for 2012, these being Spain and the Netherlands.
Prime Minister Masriano Rajoy has announced that Spain’s deficit will (hopefully) be 5.8% of total economic output in 2012, higher than the agreed target of 4.4%. It is widely thought that even this higher target will not be easy to achieve, despite the considerable austerity measures already planned by the government.
Employment in Spain is currently nearly one in four and this is still expected to rise during 2012, possibly hitting the 6 million mark. In addition, the Spanish economy contracted in the final three months of 2011 by 0.3%.
The Netherlands has also said it will miss its budget target for this year and is now aiming for a deficit of 4.5% compared to the target of 4.1%.