In particular, highly indebted countries and those with a sharp deterioration in their fiscal balances should therefore make a consolidation effort of at least 1 percentage point per annum. Fourth, the consolidation strategies should be designed in line with the Treaty and the Stability and Growth Pact, which constitute the appropriate and credible framework for fiscal policy coordination in the euro area.
The Pact provides for a degree of flexibility that is sufficient for the current circumstances. Any loosening of the framework beyond that level is not warranted, as it may pose the risk of eroding the incentive mechanisms. Fiscal strategies should respect deadlines for the correction of excessive deficits set by the ECOFIN Council in line with the Stability and Growth Pact.