The requirements of the Stability and Growth Pact states that EU countries' budget deficits should not exceed 3 percent of GDP and the national debt cannot exceed 60 percent of GDP.
Although these financial requirements are most important for the countries that adopted the Euro, all Member States should to try to reach these requirements.
A failure means that the country enters an unsustainable path, and sooner or later it becomes necessary to tighten fiscal policy significantly. In practice, this means that the country will be forced to cuts in public spending, and probably also to increase in taxation.
The countries that manage to meet EU requirements are Estonia, Finland, Luxembourg, Sweden, Denmark and Bulgaria.
Greece has by far the biggest national debt where the debt amounts to 112 percent of GDP. Estonia has the least debt, only 7.4 percent of GDP.
In other words, Greece faces huge future borrowing needs and constraints are to be expected.
Cecilia Helland