European finance ministers agreed Tuesday to end disciplinary measures against Germany and Greece, as the two countries’ budget deficits are now in line with the EU limit.

Economic growth helped Germany cut the budget deficit below the EU limit of 3 per cent of Gross Domestic Product (GDP) for the first time since 2002. as a result, all 27 EU finance chiefs formally cleared Germany, an EU official said.

The German budget deficit fell from 3.2 per cent of GDP in 2005 to 1.7 percent in 2006.

EU economic and monetary affairs commissioner Joaquin Almunia told journalists that “the improvement in the fiscal situation has been impressive during the last couple of years.”

Praising Germany’s coming under the EU ceiling by a very wide margin a year earlier than ordered, Almunia also emphasized possible economical changes in 2008, when a reform of German corporate tax goes into effect.

“We hope that this consolidation will continue and that Germany will reach... a balanced position in the medium term before 2010,” the EU commissioner said.

Germany is expected to pare its once-excessive budget deficit down to 0.6 per cent this year, reaching 0.3 per cent of GDP in 2008.

The ministers also gave a reprieve to Malta, which has brought its deficit in line with the EU limit.

The EU confirmed that Malta and Greece have also brought their budget deficits in line with the EU limit.