Fiscal reforms in the EMU: the Greek response

ABSTRACT

The common fiscal rules in the EMU constitute one of the main economic integration pillars, with the fiscal governance framework in the eurozone having been significantly reformed over the economic crisis period. Changes focusing on creating fiscal stability conditions, such as the national Fiscal Councils, the European Semester, the national Medium-Term Budgetary Frameworks (MTBFs), the debt brake and the automatic fiscal correction mechanism (budget cutter) were adopted through the legislative measures introduced by the Six Pack, the Two Pack and the Treaty on Stability, Coordination and Governance in the EMU (TSCG). This paper examines both the formal and actual response of Greece to the eurozone fiscal governance reforms. Greece seems to promote the formal implementation of these reforms by transposing them into its national law, but the paper’s conclusions confirm that there is a deviation between reaching the defined goals and actually implementing the reforms.

KEYWORDS:

• Fiscal reforms
• Greek reforms
• EMU public finance
• fiscal rules