Exclusive-New rules would give Europe more scope for military spending post-Ukraine invasion

FILE PHOTO: National flags of Ukraine and European Union rise in front of the NATO emblem, amid Russia's attack on Ukraine, in central Kyiv, Ukraine July 11, 2023. REUTERS/Valentyn Ogirenko/File Photo

BRUSSELS (Reuters) - The European Union is close to agreeing provisions in revamped fiscal rules to enable extra military spending in the wake of Russia's invasion of Ukraine, officials close to the talks said.

EU fiscal rules underpin the euro currency used in 20 nations by limiting government borrowing. They set a ceiling on budget deficits at 3% of GDP and on public debt at 60% of GDP. The bloc's executive European Commission is supposed to start disciplinary steps against countries that exceed these limits.