Stability and Growth Pact

The Stability and Growth Pact is an agreement among EU member states to maintain the stability of the Economic and Monetary Union. The pact requires member states to stay within limits on government deficit (3% of GDP) and debt (60% of GDP) and submit annual stability programs for evaluation. If a member state breaches these limits, an Excessive Deficit Procedure is initiated, and corrective actions are requested, with the possibility of economic sanctions if necessary. The pact was outlined in 1997 and entered into force in 1998 and 1999, and is intended to ensure fiscal discipline and prevent inflationary pressures on the European economy.learn more on wikipedia