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EU issues Italy with budget deadline

On Wednesday 29 June the European Union gave Italy until the end of 2007 to cut its budget deficit It gave the country two years instead of just one to bring the deficit back in line due to weakness in Italy's economy.

The commission also ordered Italy to cut its debt, currently around 107 per cent of GDP, and resolve "the deep-rooted structural problems that have saddled the Italian economy in the last decade."

"The stability and growth pact sets a normal deadline of one year, unless there are

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