July 16, 2003	Wednesday	Jumadi-ul-Awwal 15, 1424

BRUSSELS, July 15: EU economy and finance ministers on Tuesday pushed aside calls to soften European Union’s Stability and Growth Pact, but the raging debate over how to apply its rules controlling state spending could erupt again after they get back to business following the summer vacation.

They also put off making any concrete decision on an ambitious plan to kick-start Europe’s anemic growth by heavily investing in infrastructure and research projects over the next 10 years.

Shortly before euro-zone ministers met here on Monday French President Jacques Chirac, whose country is in breach of the pact, raised the tone of the debate on it, with a surprise call for the ministers to consider a temporary relaxation of its rules.

Chirac said he wanted finance ministers in the 12-nation euro-zone to “together examine provisional ways of easing” the pact.

By limiting public deficits to 3pc of GDP, the pact sharply reduces European governments’ options to stimulate growth with tax cuts or state spending. EU heavyweights France and Germany are particularly in a difficult situation, with their deficits in excess of the three-percent limit and growth flagging.—AFP