Fiscal Compact

The Fiscal Compact, formally known as the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, is an agreement among EU countries aimed at promoting financial discipline. Adopted in 2012, it requires signatory nations to maintain balanced budgets and limit public debt to create economic stability in Europe. The goal is to prevent excessive deficits and ensure sustainable public finances, thereby strengthening the economic framework of the European Union. This helps restore trust and confidence in member countries’ economies, especially after the financial crises that affected many EU states.