Italy strikes budget deal with EU
After months of intense negotiations, Italy and the European Union have come to an agreement on the Mediterranean country’s budget with the European Commission.
Italy originally presented a budget that would have seen deficit sour to 2.4% but the the Commission demanded changes to the plans because of the country's high debt.
Italy said it would not change its budget plan and forced EU officials to threaten the country with disciplinary action and expensive fines.
Nevertheless, an agreement has been reached under which Italy has agreed to lower the budget deficit to 2.04%.
Italian Prime Minister Giuseppe Conte said the compromise was a win for both sides.
"We can say in conscience that we have realised in full the wishes of our citizens, demonstrating determination in the economic politics of the government," he told the country's senate.
"We have achieved by means of a complete sense of responsibility, a shared solution, that is good for Italians and satisfactory to Europe."
European economic commissioner Pierre Moscovici said: "The agreement reached today shows unambiguously that the European Commission is not the enemy of the Italian people," he said.
"We are not a machine made up of insensitive bureaucrats, imposing austerity and denying democracy. I hope that today we can move beyond such caricatures.
"I hope that today we can also put to rest any doubts over Italy's place in Europe."
The deal still needs to be approved by the Italian parliament and The European Commission said it would watch closely to ensure Italy followed the agreement.