SPAIN and Portugal are set to be slapped with sanctions by European finance ministers after failing to get a grip on their budget deficits.
The trouble states now have 10 days to appeal against automatic penalties that amount to around 0.2 per cent of GDP.
Peter Kažimír, minister for finance of Slovakia and president of the Council today said: "I am sure that we will have a smart, intelligent result at the end.”
And earlier this week French Finance Minister Michel Sapin waded into the debate and this week said Portugal should not be punished.
He said: "Portugal has made enormous efforts in the past years. It does not deserve excessive discipline."
Portugal's deadline for correcting the deficit had already been extended by two years to 2015, as a result of the recession that the country faced.
Lisbon had been given deficit targets of 5.5 per cent of GDP in 2013, four per cent in 2014 and 2.5 per cent of GDP in 2015 - but recorded an actual deficit of 4.4 per cent last year.
It had been given deficit targets of 6.5 per cent of GDP for 2013, 5.8 per cent for 2014, 4.2 per cent of GDP for 2015 and 2.8 per cent of GDP for 2016.
But the deficit amounted to 5.9 per cent of GDP in 2014 and 5.1 per cent of GDP in 2015.
The Council today concluded that Spain is not set to correct its deficit in 2016 as required.