2004/918/EC: Council Decision of 5 July 2004 on the existence of an excessive deficit in Hungary

• Published date: 30 December 2004
• Subject Matter: Economic and Monetary Union,Economic policy
• Official Gazette Publication: Official Journal of the European Union, L 389, 30 December 2004

30.12.2004 EN Official Journal of the European Union L 389/27

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COUNCIL DECISION

of 5 July 2004

on the existence of an excessive deficit in Hungary

(2004/918/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 104(6) thereof,

Having regard to the recommendation from the Commission,

Having regard to the observations made by Hungary,

Whereas:

(1) According to Article 104 of the Treaty, Member States are to avoid excessive government deficits; this applies also to Member States with a derogation, the case of all countries that joined the EU on 1 May 2004.

(2) The Stability and Growth Pact is based on the objective of sound government finances as a means of strengthening the conditions for price stability and for strong sustainable growth conducive to employment creation.

(3) The excessive deficit procedure under Article 104 provides for a decision on the existence of an excessive deficit and the Protocol on the excessive deficit procedure annexed to the Treaty sets out further provisions relating to the implementation of the excessive deficit procedure. Council Regulation (EC) No 3605/93 of 22 November 1993 on the application of the Protocol on the excessive deficit procedure annexed to the Treaty establishing the European Community (1), lays down detailed rules and definitions for the application of the provisions of the said Protocol.

(4) Article 104(5) of the Treaty requires the Commission to address an opinion to the Council if the Commission considers that an excessive deficit in a Member State exists or may occur. Having examined all relevant factors taken into account in its report in accordance with Article 104(3) and having regard to the opinion of the Economic and Financial Committee in accordance with Article 104(4), the Commission concluded in its opinion of 24 June 2004 that there exists an excessive deficit in Hungary.

(5) Article 104(6) of the Treaty lays down that the Council should consider any observations which the Member State concerned may wish to make before deciding, after an overall assessment, whether an excessive deficit exists.

(6) The overall assessment leads to the following conclusions: the general government deficit reached 5,9 % of GDP in 2003 in Hungary, above the 3 % of GDP Treaty reference value. The

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