               EUROPEAN COMMISSION
            Brussels, 16.5.2018
            COM(2018) 299 final
            Recommendation for a
            COUNCIL DECISION
            authorising the opening of negotiations with Cabo Verde for the conclusion of a Protocol implementing the Fisheries Partnership Agreement between the European Communities and Cabo Verde
            {SWD(2018) 193 final}{SWD(2018) 194 final}

               EXPLANATORY MEMORANDUM

               1.CONTEXT OF THE PROPOSAL

               •Reasons for and objectives of the proposal

                  The Commission proposes to negotiate a new protocol to the Sustainable Fisheries Partnership Agreement (SFPA) concluded with the Republic of Cabo Verde which meets the needs of the Union fleet and is in line with Regulation (EU) No 1380/2013 on the common fisheries policy and the 19 March 2012 Council Conclusions on a Communication from the Commission on the external dimension of the common fisheries policy.

               •Consistency with existing policy provisions in the policy area

                  The current SFPA between the European Union and Cabo Verde was concluded on 30 December 2006
                     1
                  . The current four-year Protocol
                     2
                   to the Fisheries Partnership Agreement entered into application on 23 December 2014 and will expire on 22 December 2018. It fixes the fishing opportunities provided to the Union fleet and the corresponding financial contribution paid by the Union and by ship-owners. The annual EU public financial contribution due to Cabo Verde amounts to EUR 550 000 for the first 2 years, of which EUR 275 000 is earmarked for sectoral support; and EUR 500 000 for the last 2 years, of which EUR 250 000 is earmarked for sectoral support.

               The SFPA with Cabo Verde provides fishing opportunities targeting tuna and highly migratory species for vessels from three Member States (Spain, France and Portugal). The European Union already has a well-developed network of bilateral SFPAs in West Africa, namely with Morocco, Mauritania, São Tomé and Príncipe, Senegal, Liberia and Côte d’Ivoire.

                  SFPAs help promote the objectives of the common fisheries policy internationally, ensuring that Union fishing activities outside EU waters are based on the same principles and standards as those applicable under Union law. In addition, SFPAs foster scientific cooperation between the EU and its partner and promote transparency and sustainability to improve the management of fishing resources. They also encourage governance by supporting the monitoring, control and surveillance of national and foreign fleets’ activities and provide funding to fight against illegal, unreported and unregulated fishing and contribute to the sustainable development of the local fishing industry. SFPAs strengthen the European Union’s position in international and regional fishing organisations, in particular in the International Commission for the Conservation of Atlantic Tunas, the body set up under international law to conserve and manage highly migratory species in the region.

               •Consistency with other Union policies

                  The negotiation of a new protocol to the SFPA with Cabo Verde is in line with the EU’s external action towards African, Caribbean and Pacific countries, and in particular with the Union objectives regarding the respect of democratic principles and human rights.

                  While at a very local scale, the SFPA will complement the New Migration Partnership Framework
                     3
                   approach and, by generating economic activity in fisheries, will help address the causes of emigration from Cabo Verde.

               2.LEGAL ELEMENTS OF THE RECOMMENDATION

               •Legal basis

                  The legal basis for the decision is provided by Article 218 of the Treaty on the Functioning of the European Union (TFEU), in Part five on external action by the Union, Title V on international agreements, which sets out the procedure for negotiating and concluding agreements between the EU and third countries.

               •Subsidiarity (for non-exclusive competence)

                  Not applicable, exclusive competence.

               •Proportionality

                  The decision is proportional to the objective.

               •Choice of the instrument

                  The instrument is provided for under Article 218(3) and Article 218(4) of the TFEU.

               3.RESULTS OF CONSULTATIONS WITH INTERESTED PARTIES AND IMPACT ASSESSMENTS

               •Ex post evaluations/fitness checks of existing legislation

                  In 2017-2018 the Commission carried out an ex post evaluation of the current protocol to the SFPA with Cabo Verde as well as an ex ante evaluation of a possible renewal of the protocol. The conclusions of the evaluation are set out in a separate Staff Working Document.

                  The evaluation concluded that the EU tuna fishing sectors are firmly interested in fishing in Cabo Verde’s waters and that a renewal of the Protocol would help strengthen monitoring, control and surveillance and help improve governance of the fisheries in the region. The evaluation concluded that renewing the Protocol would also be beneficial for Cabo Verde in view of the large financial contribution paid under the Protocol.

               •Stakeholder consultations

                  Member States, industry representatives, international civil society organisations, as well as Cabo Verde’s fisheries administration and civil society were consulted as part of the evaluation. Consultations have also taken place in the framework of the Long Distance Advisory Council.

               •Collection and use of expertise

                  Not applicable.

               •Impact assessment

                  Not applicable.

               •Regulatory fitness and simplification

                  Not applicable.

               •Fundamental rights

                  The negotiating directives proposed as an annex to the decision recommend authorising the opening of negotiations. They also recommend including a clause on the consequences of violations of human rights and democratic principles.

               4.BUDGETARY IMPLICATIONS

               A new protocol will require the payment of a financial contribution to Cabo Verde which is compatible with the 2014-2020 Multiannual Financial Framework (MFF), in particular as regards allocations to the budget line for SFPAs. The annual amounts for commitments and payments are established in the yearly budgetary procedure, including the reserve line for protocols that have not entered into force in the beginning of the year
                  4
               .

               5.OTHER ELEMENTS

               •Implementation plans and monitoring, evaluation and reporting arrangements

                  Negotiations are expected to open in the second quarter of 2018.

               •Detailed explanation of the specific provisions of the proposal

                  The Commission recommends that:

                  - the Council should authorise the Commission to open and conduct negotiations for the conclusion of a new protocol to Fisheries Partnership Agreement with Cabo Verde;

                  - the Commission should be nominated as the EU negotiator on this subject;

                  - the Commission should conduct the negotiations in consultation with the special committee, as set out in the Treaty on the Functioning of the European Union;

                  - the Council should approve the negotiating directives annexed to this recommendation.

               Recommendation for a

               COUNCIL DECISION

               authorising the opening of negotiations with Cabo Verde for the conclusion of a Protocol implementing the Fisheries Partnership Agreement between the European Communities
                  and Cabo Verde

               THE COUNCIL OF THE EUROPEAN UNION,

               Having regard to the Treaty on the Functioning of the European Union, and in particular Article 218 (3) and (4),

               Having regard to the recommendation from the European Commission,

               Whereas:

               Negotiations should be opened with Cabo Verde with a view to concluding a protocol implementing the Fisheries Partnership Agreement between the European Communities and Cabo Verde,

               HAS ADOPTED THIS DECISION:

               Article 1

               The Commission is hereby authorised to open negotiations with Cabo Verde with a view to concluding a protocol implementing the Fisheries Partnership Agreement between the European Communities and Cabo Verde.

               Article 2

               The negotiations shall be conducted in consultation with the Council Working Party on External Fisheries Policy and on the basis of the negotiating directives of the Council set out in the annex to this Decision.

               Article 3

               This Decision is addressed to the Commission.

               Done at Brussels,

                     For the Council

                        The President

                     (1)

                        OJ L 414 of 30.12.2006, p. 36.

                     (2)

                        OJ L 369, 24.12.2014, p. 3.

                     (3)

                        COM(2016) 385 final, 7.6.2016.

                     (4)

                        Chapter 40 (reserve line 40 02 41) in line with the MFF interinstitutional agreement (2013/C 373/01).

    ---documentbreak---

               EUROPEAN COMMISSION
            Brussels,16.5.2018
            COM(2018) 299 final
            ANNEX
            to the
            Recommendation for the COUNCIL DECISION
            authorising the opening of negotiations on behalf of the European Union for the renewal of the protocol to the Fisheries Partnership Agreement with Cabo Verde
            {SWD(2018) 193 final}{SWD(2018) 194 final}

               ANNEX

               Negotiating directives for the conclusion of a new protocol between the European Union and Cabo Verde

               –The objective of the negotiations is the renewal of the protocol to the Fisheries Partnership Agreement between the European Union and Cabo Verde in line with Regulation (EU) N° 1380/2013 on the Common Fisheries Policy and with the Council Conclusions of 19 March 2012 on the Commission Communication of 13 July 2011 on the external dimension of the Common Fisheries Policy.

               –To promote sustainable and responsible fishing while ensuring mutual benefits for the EU and Cabo Verde through a new protocol, the Commission's negotiation objectives shall be based on the following:

               ·Ensure access to the fishing zone of Cabo Verde and the necessary authorisations for vessels of the EU fleet to fish in that zone, thereby inter alia maintaining the network of Sustainable Fisheries Partnership Agreements available to EU operators;

               ·Take into account the best available scientific advice and relevant management plans adopted by Regional Fisheries Management Organisations (RFMO), in order to ensure sustainable of fishing activities and to promote ocean governance at the international scale. The fishing activities should be directed exclusively at available resources, taking into account the local fleet's fishing capacity, while paying special attention to the highly migratory nature of some of the stocks concerned;

               ·Obtain an appropriate share of the fisheries resources, commensurate with the EU fleets' interests, when they also interest other foreign fleets, taking into account activity of the EU fleet in the region, in the light of the most updated and best available scientific assessments;

               ·Establish a dialogue to reinforce the sectoral policy with a view to encouraging the implementation of a responsible fisheries policy, in connection with the country's development objectives, in particular as regards the fisheries governance, the fight against illegal, unreported and unregulated fishing, control, monitoring and surveillance of fishing activities and provision of scientific advice, and foster employment generation contributing to inter alia addressing the root causes of emigration from Cabo Verde;

               ·Include a clause on the consequences of violations of human rights and democratic principles;

               ·Include a clause for the preferential access of the EU fleet to the fishing zone of Cabo Verde and for the application of the same technical conditions to all foreign fleets;

               –In order to avoid interruption of fishing activities, the new protocol should include a clause of provisional application.

               –In particular, the protocol should define:

               ·the fishing opportunities, by category, to be granted to European Union vessels;

               ·the financial compensation and the conditions for its payment; and

               ·the priorities and the mechanisms for an effective implementation of sectoral support and its regular monitoring.


               EUROPEAN COMMISSION
            Brussels,22.11.2017
            COM(2017) 801 final
            Recommendation for a
            COUNCIL DECISION
            abrogating Decision 2008/713/EC on the existence of an excessive deficit in the United Kingdom

               Recommendation for a

               COUNCIL DECISION

               abrogating Decision 2008/713/EC on the existence of an excessive deficit in the United Kingdom

               THE COUNCIL OF THE EUROPEAN UNION,

               Having regard to the Treaty on the Functioning of the European Union, and in particular Article 126(12) thereof,

               Having regard to the recommendation from the Commission,

               Whereas:

               (1)On 8 July 2008, following a recommendation from the Commission, the Council decided, by Council Decision 2008/713/EC in accordance with Article 104(6) of the Treaty establishing the European Community, that an excessive deficit existed in the United Kingdom.
                  1
                The Council noted that, according to the EDP data notified by the United Kingdom authorities in March 2008, the United Kingdom's general government deficit in 2008-09 was expected to reach 3.2 % of GDP, thus exceeding the 3 % of GDP Treaty reference value. Furthermore, following the publication of the March 2008 budget, a policy announcement on 13 May 2008 reducing personal income tax in 2008-09 was expected to further increase the planned deficit in that financial year. Adding this measure to the Commission 2008 spring forecast implied a deficit of 3.5 % of GDP in 2008-09. The excessive deficit was also not considered temporary as the Commission forecast, on the basis of unchanged policies, estimated a deficit in 2009-10 of 3.3 % of GDP. The Council further noted that the general government debt ratio remained well below the 60 % reference value, although it was projected to be on a rising trend up to 2009-10.

               (2)On the same date, in accordance with Article 104(7) of the Treaty and Article 3(4) of Council Regulation (EC) No 1467/97, the Council, based on a recommendation from the Commission, addressed a Recommendation to the United Kingdom with a view to bringing the excessive deficit situation to an end by financial year 2009-10 at the latest. The Council also set a deadline of 8 January 2009 for effective action to be taken.

               (3)In accordance with Article 104(8) of the Treaty, the Council decided, on 27 April 2009, that the United Kingdom had not taken effective action in response to the Council Recommendation of 8 July 2008.
                  2

               (4)Recognising that the United Kingdom's budgetary position in 2009-10 resulted from the implementation of measures amounting to around 1.5 % of GDP, which were an appropriate response to the European Economic Recovery Plan, and the free play of automatic stabilisers, on 2 December 2009 the Council issued a revised Recommendation under Article 126(7) of the TFEU, recommending that the United Kingdom put an end to the excessive deficit situation by 2014-15. Specifically, in order to bring the general government deficit below 3 % of GDP in a credible and sustainable manner, the United Kingdom was recommended to ensure an average annual fiscal effort of 1¾ % of GDP between 2010-11 and 2014-15. In its Recommendation of 2 December 2009, the Council established a deadline of 2 June 2010 for effective action to be taken in line with the Article 3(4) of Regulation (EC) No 1467/97.

               (5)On 6 July 2010, the Commission concluded that, based on the Commission 2010 spring forecast, the United Kingdom had taken effective action in compliance with the Council Recommendation of 2 December 2009 under Article 126(7) of the Treaty.

               (6)On 19 June 2015, in accordance with Article 126(8) of the Treaty, the Council decided that the United Kingdom had not taken effective action in response to the Council Recommendation of 2 December 2009.
                  3
                The Council noted that the United Kingdom had experienced a large fall in real GDP growth as a result of the global economic and financial crisis in 2008 and 2009, which had also affected its public finances. The United Kingdom had subsequently implemented a consolidation plan and the general government deficit had fallen, as a percentage of GDP, each year between the 2009-10 and 2014-15 financial years. In contrast, the general government debt ratio had continued to increase over this period, driven mainly by the headline deficit, but also by financial sector interventions. The Council concluded that, despite a fiscal consolidation programme being set out and implemented, the United Kingdom had not put an end to its excessive deficit by 2014-15. Furthermore, the United Kingdom had not adhered to the average annual fiscal effort of 1¾ % of GDP that had been recommended by the Council on 2 December 2009.

               (7)On the same date, in accordance with Article 126(7) of the Treaty and Article 3(4) of Council Regulation (EC) No 1467/97, the Council, based on a recommendation from the Commission, addressed a Recommendation to the United Kingdom to correct the excessive deficit by financial year 2016-17. Specifically, the United Kingdom was recommended to reach a headline deficit of 4.1 % of GDP in 2015-16 and 2.7 % of GDP in 2016-17, which was projected to be consistent with delivering an improvement in the structural balance of 0.5 % of GDP in 2015-16 and 1.1 % of GDP in 2016-17, based on the updated Commission 2015 spring forecast.

               (8)On 16 November 2015, the Commission concluded that the United Kingdom had taken effective action towards correcting the excessive deficit by financial year 2016-17, as recommended by the Council on 19 June 2015.

               (9)In accordance with Article 4 of the Protocol (No 12) on the excessive deficit procedure annexed to the Treaty on the European Union and to the TFEU, the Commission provides the data for the implementation of the procedure. As part of the application of that Protocol, Member States are to notify data on government deficits and debt and other associated variables twice a year, namely before 1 April and before 1 October, in accordance with Article 3 of Council Regulation (EC) No 479/2009.
                  4

               (10)The Council takes decisions to abrogate decisions on the existence of an excessive deficit on the basis of notified data. Moreover, a decision on the existence of an excessive deficit should be abrogated only if the Commission forecasts indicate that the deficit will not exceed the Treaty reference value of 3 % of GDP over the forecast horizon.
                  5

               (11)Based on data provided by the Commission (Eurostat) in accordance with Article 14 of Regulation (EC) No 479/2009, following the 2017 Convergence Programme, the September 2017 notification by the United Kingdom, and the Commission 2017 autumn forecast, the following conclusions are justified:

               –The United Kingdom has met the recommended general government deficit targets in recent years. After peaking at 10 % of GDP in 2009-10, the nominal general government deficit has followed a steadily declining trend, falling to 4 % in 2015-16 and 2.3 % in 2016-17, in line with the Council Recommendation of 19 June 2015. Fiscal consolidation undertaken during the period has largely been expenditure based, with total current expenditure falling from 42.9 % of GDP in 2009-10 to 38 % of GDP in 2016-17. A rise in the government revenue ratio, from 37.4 % of GDP in 2009-10 to 38.6 % of GDP in 2016-17, has also contributed, albeit to a lesser extent.

               –The 2016-17 Convergence Programme, submitted by the United Kingdom authorities on 27 April 2017 and covering the period 2016-17 to 2021-22, projected an increase in the general government deficit to 2.8 % of GDP in 2017-18 followed by a fall to 1.9 % of GDP in 2018-19. This forecast was based on a planned general government deficit of 2.7 % in 2016-17, as per the EDP data notified by the United Kingdom authorities in March 2017. Since the submission of the Convergence Programme, the Office for National Statistics (ONS) has revised down its estimate of the general government deficit in 2016-17 to 2.3 % of GDP. While the United Kingdom authorities did not subsequently publish an updated forecast for the general government deficit, the Commission 2017 autumn forecast projects deficits of 2.5 % in 2017-18, 1.8 % in 2018-19, and 1.3 % in 2019-20, based on a no-policy-change assumption. Thus, the deficit is set to remain below the Treaty reference value of 3 % of GDP over the forecast horizon.

               –According to its 2017 autumn forecast, the Commission estimates the structural balance, which is the general government balance adjusted for the economic cycle and net of one-off and other temporary measures, to have improved by 3.2 % of GDP between 2008-09 and 2016-17.

               –The United Kingdom's general government gross debt ratio has increased significantly since the Council decided, on 8 July 2008, that an excessive deficit existed in the United Kingdom. The general government debt ratio increased from 41 % of GDP in 2007-08 to 86.8 % in 2016-17, reflecting higher nominal general government deficits as well as financial sector interventions during this period. According to the Commission 2017 autumn forecast, the debt-to-GDP ratio is expected to have peaked in 2016-17 and to decrease gradually to 82.9 % of GDP in 2019-20.

               (12)In accordance with Article 126(12) of the Treaty, a Council decision on the existence of an excessive deficit is to be abrogated when the excessive deficit in the Member State concerned has, in the view of the Council, been corrected.

               (13)In the view of the Council, the excessive deficit in the United Kingdom has been corrected, and Decision 2008/713/EC should therefore be abrogated.

               (14)As from 2017-18, which is the financial year following the correction of the excessive deficit, the United Kingdom is subject to the preventive arm of the Stability and Growth Pact and should progress towards the minimum medium-term budgetary objective at an appropriate pace, including respecting the expenditure benchmark, and comply with the debt criterion in accordance with Article 2(1a) of Regulation (EC) No 1467/97,

               HAS ADOPTED THIS DECISION:

               Article 1

               From an overall assessment it follows that the excessive deficit situation in the United Kingdom has been corrected.

               Article 2

               Decision 2008/713/EC is hereby abrogated.

               Article 3

               This Decision is addressed to the United Kingdom of Great Britain and Northern Ireland.

               Done at Brussels,

                     For the Council

                     The President

                     (1)

                        Council Decision 2008/713/EC of 8 July 2008 on the existence of an excessive deficit in the United Kingdom (OJ L 238, 5.9.2008, p. 5).

                     (2)

                        Council Decision 2009/409/EC of 27 April 2009 establishing, in accordance with Article 104(8) of the Treaty, whether effective action has been taken by the United Kingdom in response to the Council Recommendation of 8 July 2008 pursuant to Article 104(7) (OJ L 132, 29.5.2009, p. 11).

                     (3)

                        Council Decision 2015/1098 of 19 June 2015 establishing that no effective action has been taken by the United Kingdom in response to the Council Recommendation of 2 December 2009 (OJ L 180, 8.7.2015, p. 1).

                     (4)

                        Council Regulation (EC) No 479/2009 of 25 May 2009 on the application of the Protocol on the excessive deficit procedure annexed to the Treaty establishing the European Community OJ L 145, 10.6.2009, p. 1.

                     (5)

                        In line with the “Specifications on the implementation of the Stability and Growth Pact and Guidelines on the format and content of Stability and Convergence Programmes” of 3 September 2012. See:
                  http://ec.europa.eu/economy_finance/economic_governance/sgp/pdf/coc/code_of_conduct_en.pdf


               EUROPEAN COMMISSION
            Brussels,22.11.2017
            COM(2017) 802 final
            Recommendation for a
            COUNCIL RECOMMENDATION
            with a view to correct the significant observed deviation from the adjustment path toward the medium-term budgetary objective in Romania
            {SWD(2017) 603 final}

               Recommendation for a

               COUNCIL RECOMMENDATION

               with a view to correct the significant observed deviation from the adjustment path toward the medium-term budgetary objective in Romania

               THE COUNCIL OF THE EUROPEAN UNION,

               Having regard to the Treaty on the Functioning of the European Union, and in particular Article 121(4) thereof,

               Having regard to Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies,
                  1
                and in particular 10(2), second sub-paragraph, thereof,

               Having regard to the recommendation of the Commission,

               Whereas:

               (1)On 16 June 2017 the Council decided in accordance with Article 121(4) of the Treaty on the Functioning of the European Union ("TFEU") that a significant observed deviation from the adjustment path toward the medium-term budgetary objective existed in Romania and issued a recommendation for Romania to take the necessary measures to ensure that the nominal growth rate of net primary government expenditure
                  2
                does not exceed 3.3% in 2017, corresponding to an annual structural adjustment of 0.5% of GDP.
                  3
                Romania was recommended to use any windfall gains for deficit reduction, while budgetary consolidation measures should ensure a lasting improvement in the general government structural balance in a growth-friendly manner. The Council established a deadline of 15 October 2017 for Romania to report on action taken in response to the recommendation.

               (2)On 11 July 2017 the Council recommended Romania to ensure that in 2017 it complies with the Council Recommendation of 16 June 2017 with a view to correcting the significant deviation from the adjustment path toward the medium-term budgetary objective.
                  4
                For 2018, Romania was recommended to pursue a substantial fiscal effort in line with the requirements of the preventive arm of the Stability and Growth Pact, in order to further adjust towards its medium-term budgetary objective of a structural deficit of 1 % of GDP. According to the commonly agreed adjustment matrix under the Stability and Growth Pact, that adjustment translated into a requirement of a nominal growth rate of net primary government expenditure not exceeding 4.3% in 2018. It would correspond to a structural adjustment of 0.5 % of GDP.

               (3)On 26 and 27 September 2017, the Commission undertook an enhanced surveillance mission in Romania for the purpose of on-site monitoring under Article -11(2) of Council Regulation (EC) No 1466/97. The Commission reported its findings to the Council on 24 October 2017 and made them public, after having transmitted its provisional findings to the Romanian authorities.

               (4)On 13 October 2017 the Romanian authorities submitted the report on effective action in response to the Council Recommendation of 16 June 2017. Given the information provided by the Romanian authorities in their report on action taken and the overall assessment based on the 2017 autumn forecast, the Council on [XX] concluded that Romania has not taken effective action in response to the Council Recommendation of 16 June 2017.

               (5)Romania is pursuing a pro-cyclical fiscal policy in the presence of high economic  growth and a positive output gap. In 2017 the structural balance is estimated to be 2.3% of GDP away from its medium-term budgetary objective. Therefore, and in light of the absence of effective action by Romania it is appropriate to address to that Member State a revised recommendation under Article 121(4) TFEU on the appropriate measures to be taken.

               (6)Based on the output gap projections of the Commission 2017 autumn forecast, Romania is in normal economic times in 2017 and 2018. Romania's general government debt ratio is below the 60% of GDP threshold. The minimum required structural effort prescribed by Regulation (EC) No 1466/97 and the commonly agreed adjustment matrix under the Stability and Growth Pact, which factors in the prevailing economic circumstances and possible sustainability concerns, amounts to 0.5% of GDP.

               (7)Romania's structural deficit is projected by the Commission to increase by 1.1% of GDP in 2017, while the Council Recommendation of 16 June 2017 asked for a structural decrease of at least 0.5% of GDP. Additionally, Romania is projected to remain at the 3% of GDP deficit reference value of the Treaty in 2017 and is forecast to breach it by a significant margin in 2018 based on the Commission autumn 2017 forecast.

               (8)An additional effort necessary to bring Romania back on an appropriate adustment path following the slippages in 2016 and 2017 should complement the adjustment of 0.5% of GDP recommended by the Council on 11 July 2017. An additional effort of 0.3% of GDP seems appropriate given the magnitude of the observed significant deviation from the recommended adjustment path towards the medium-term budgetary objective and it will accelerate adjustment back towards the medium-term budgetary objective. The required improvement of the structural balance by 0.8% of GDP in 2018 is consistent with the nominal growth rate of net primary government expenditure not exceeding 3.3% in 2018.

               (9)The Commission 2017 autumn forecast projects a further deterioration of the structural balance by 1% in 2018. Therefore, a structural improvement of 0.8% of GDP in 2018 translates into a need to adopt measures of a total structural yield of 1.8% of GDP compared to the current 2018 baseline from the Commission 2017 autumn forecast.

               (10)The Commission 2017 autumn forecast projects a general government deficit of 3.9% of GDP in 2018, which is above the 3% of GDP Treaty reference value. The required structural adjustment of 0.8% of GDP compared to the projected outcome for 2017 would also ensure that Romania respects the 3% of GDP general government deficit threshold in 2018 with a margin.

               (11)The requirements for 2018, issued in this recommendation, supersede the corresponding elements set out in the fiscal recommendation contained in the Council Recommendation addressed to Romania on 11 July 2017.

               (12)Romania should report to the Council on action taken in response to this Recommendation by 15 April 2018, possibly as part of its Convergence Programme submitted pursuant to Article 7 of Regulation (EC) No 1466/97.

               (13)It is approprite that this recommendation should be made public,

               HEREBY RECOMMENDS:

               THAT ROMANIA:

               (1)takes the necessary measures to ensure that the nominal growth rate of net primary government expenditure does not exceed 3.3% in 2018, corresponding to an annual structural adjustment of at least 0.8% of GDP in 2018, thereby putting the Member State on an appropriate adjustment path toward the medium-term budgetary objective;

               (2)uses any windfall gains for deficit reduction; budgetary consolidation measures should secure a lasting improvement in the general government structural balance in a growth-friendly manner;

               (3)reports to the Council by 15 April 2018 on action taken in response to this Recommendation.

               This recommendation is addressed to Romania.

               Done at Brussels,

                     For the Council

                     The President

                     (1)

                        OJ L 209, 2.8.1997, p. 1.

                     (2)

                        Net government expenditure is comprised of total government expenditure excluding interest expenditure, expenditure on Union programmes fully matched by Union funds revenue and non-discretionary changes in unemployment benefit expenditure. Nationally financed gross fixed capital formation is smoothed over a four-year period. Discretionary revenue measures or revenue increases mandated by law are factored in. One-off measures on both the revenue and expenditure sides are netted out.

                     (3)

                        Council Recommendation of 16 June 2017 with a view to correcting the significant observed deviation from the adjustment path toward the medium-term budgetary objective in Romania (OJ C 216, 6.7.2017, p. 1).

                     (4)

                        Council Recommendation of 11 July 2017 on the 2017 National Reform Programme of Romania and delivering a Council opinion on the 2017 Convergence Programme of Romania (OJ C 261, 9.8.2017, p. 98).