The White Bible of the Commission for the defensive costs Last week, she brought restraint smiles to Athens, as her positions are justified to some extent Greece to provide fiscal flexibility to the Member States so that those who spend a lot on their defense will not be in danger.
However, the debate on the increase in defense spending is all over, as critical appointments at European level are being held and Greece continues to fight for its proposals.
As reported by newsit.grciting top sources from the Ministry of Finance (Ministry of Finance), the main proposal of Athens is to establish a European average spending as a comparison for the percentage of annual growth.
What the Commission proposes, what Greece wants
The Commission’s proposals are clear: it proposes the exclusion of an annual increase in defense spending up to 1.5% of GDP from deficit calculation procedures, with a reference year in 2021.
That is, starting the calculation from the 2021 figures, it will exclude any costs that will be added from there up to 1.5% of GDP per year.
In this particular case, the problem lies in the fact that Greece and in 2021, before the start of the war in Ukraine, had very high costs, reaching 6 billion (NATO data raised this number even higher).
With the goal of defense spending on just over € 6.3 billion for 2025, it means that Greece will have some benefit, but not as high as if the basis was different. On the contrary, those countries were not typically okay with their obligations to NATO in 2021, and spent less will be rewarded, as even larger amounts will be excluded from their deficit, resulting in a larger “fiscal space”.
As a result, the new leadership of the Ministry of Finance continues to fight on the same basis of the Greek proposals that had been formulated at European level and before the White Bible. And the basic is that the increase in the increase should be calculated on the basis of a reference to a European average expenditure of 2021 (or any other year) and not on what each Member State spent on a national basis.
The explanation for this is that if, for example, Greece spent 6 billion euros in 2021, and in 2025 it spends $ 6.5 billion, based on the Commission’s proposal it will be able to exclude half a billion euros, re -resulting it in benefits and positive interventions. However, if there was a European average, which was due to the fact that Greece was also a 2021 champion of spending, he would be much lower, eg. At € 4 billion, Greece could exclude and use multiple amounts.
The question is still unclear in the White Paper, the question of which year GDP will be taken as a reference basis, as Greece was different in 2021 and another in 2025, recording three times the growth rates of other European countries.