The 'huge' price of no reform

Pedro Solbes, EU monetary-affairs commissioner, warned that Berlin could face fines from Brussels unless it gets its budget deficit under control. The fine for exceeding the allowed deficit level (3% of GDP) could be 0.5% of GDP. Meanwhile, EU Ambassador Ramiro Cibrián suggested in a talk to the American Chamber of Commerce on Wed. that the CR could face fines from Brussels in the future if it doesn't get its public finances under control. The remark came one day before the CR was ordered to pay Kč 10.5bn to CME for letting Vladimír Železný hijack TV Nova. Premier Vladimír Špidla said the Kč 10.5bn is a huge amount, given that the cabinet is trying to reform public finances and save every crown. Coincidentally, a fine from Brussels of 0.5% of GDP would also be about Kč 11bn. Unlike in the Nova case, though, it's still not too late to take preventative action.