Radio New Zealand - Te Reo Irirangi o Aotearoa

European states criticised over deficits

Updated at 2:50 pm on 18 March 2010

The European Commission has criticised most European nations for failing to keep their deficits in check.

The rules say government deficits among eurozone countries must be below 3% of gross domestic product.

But the commission says countries like Germany, France, Spain, Italy and Britain are overly optimistic about growth to help meet debt targets.

The UK's deficit is expected to hit £178bn this year - 12.6% of gross domestic product, and the commission has warned it is not on course to cut its deficit in line with EU rules by a deadline of 2015.

It says only Bulgaria and Estonia have credible forecasts.

UK chancellor Alistair Darling has defended the government's approach to the deficit, arguing that cutting it too quickly by reducing government spending would risk harming the UK's emergence from recession, the BBC reports.

Meanwhile, Greek Prime Minister George Papandreou says there's no chance his country will be kicked out of the euro zone.

Despite heavy debts, Mr Papandreou says Greece is sorting out its financial problems.

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