Brussels - AFP
Vulnerable eurozone giants brace Wednesday for annual economic and public finance report cards from Brussels that may demand policy changes, or else threaten fines. Issued for only the first time since Brussels was given the power to fine spendthrift states, all eyes will be on Spain, Europe\'s fourth-biggest economy. Many economists anticipate Madrid will have to ask for financial support from its 16 eurozone partners, while with foreign investors on the run moves are already afoot to create European-level banking safety nets. How the Commission handles France -- the No. 2 eurozone economy -- is also seen as a guage of how serious Brussels is about flexing new-found muscles. The power to hit governments in the pocket is arguably the key tangible to arise from the two-year debt crisis, as the European Union tries to take active control of potential problems across the single market. An early leak to Italy\'s La Stampa newspaper of 29 pages of recommendations for Mario Monti\'s caretaker government in Rome, seen by AFP, shows that euro commissioner Olli Rehn is exercising his authority. However the reports covering all 27 European Union states remain drafts likely to be watered down following discussions among the 27-strong cabinet of nationally-appointed commissioners. The one on Italy, for example, sees tough language struck out on a failure to crack down on tax evasion, and other actions demanded are also likely to dissappear. For Spain, much of the intrigue will centre on what its government is told to do about its deficit -- veering badly off target in a time of deep recession and massive unemployment. For France, the question is \"will the Commission dare to order the kind of fundamental reforms it needs to adapt long-term to new welfare models?,\" said one senior diplomat. As relentless austerity is blamed by critics for accelerating a plunge towards recession, Commission chief Jose Manuel Barroso underlined in a speech Tuesday that Brussels will try to use commonsense where cuts that run too deep could put nascent growth potential at risk. He said the Commission would seek to apply its mandate to ensure limits on deficit and debt levels in particular are adhered to in a \"growth-friendly and differentiated way.\" \"The Commission will monitor the impact of tight budget constraints on growth, enhancing public expenditure, and on public investment,\" he said. Rehn is due to unveil the finished reports around 1100 GMT.