"This proposal is the basis for further negotiations," Lindner said. "We still have a lot of work to do." Germany, the European Union's largest economy, wants the Commission proposal to have numerical benchmarks that lead to a transparent reduction in debt.
The European Commission published on Wednesday its legislative proposal for the new fiscal rules, following a plan published in November that spelled out the Commission's thinking and gave EU countries the opportunity to give their feedback.
Lindner said he saw some progress in the new proposal of
the Commission but that more consultations were needed.
The Commission proposed in November individual debt
reduction paths, meaning that it would negotiate a plan to
reduce debt with each individual country, instead of
implementing one-size-fits-all rules.
Germany does not favour bilateral negotiations between the Commission and individual member states, arguing that tailored rules will mean that not all countries are treated equally, preventing comparisons.
"Germany wants clear rules, with numerical references
and benchmarks," Lindner said.
"Germany would not support a softening of the Stability and Growth Pact. In the future, fiscal rules must even more strongly be the basis for economic stability and growth."
At a meeting of EU finance ministers in Stockholm on
Friday and Saturday, there will be an initial exchange of ideas,
but an agreement will still take time, Lindner said.
The main risk is that disagreement could delay the reform beyond the 2024 European elections.
Mujtaba Rahman, Eurasia Group's managing director for
Europe, forecast a deal before the elections in May 2024,
probably in late February or March next year.
(Reporting by Maria Martinez, Editing by Friederike Heine)
