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Italy to adjust government budget following EC request

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Staff Writer | April 12, 2017
Italy's cabinet approved a 0.2% budget adjustment to comply with a European Commission request to trim spending.
Paolo Gentiloni
Europe   "Our accounts are in order"
The Commission made the request worth EUR3.4 billion in January.

"Our accounts are in order," Prime Minister Paolo Gentiloni told a press conference after the cabinet meeting.

The government won't be raising taxes to cover the budget adjustment, he said.

The government revised upward its projected gross domestic product growth for 2017, from 1 to 1.1%, he added.

Italy's proposed 2017 budget contained a planned shortfall of 2.3% of gross domestic product (GDP), which the commission deemed too high.

Italy initially refused to trim its budget, saying it needed the money for the migrant crisis and to rebuild after devastating earthquakes that killed 299 and levelled thousands of homes and public buildings last year.

More than 30,000 migrants and refugees reached Europe by sea through April 9, with over 80% of those arriving in Italy, according to the International Organization for Migration (IOM).

National debt stood at just over EUR2.217 trillion, or 132.6% of gross domestic product at the end of 2016, up from 132.3% at the end of 2015, according to official statistics agency Istat.