Eurozone: "Look who is calling the kettle black" - Citigroup Says Netherlands No Longer Part of Euro-Area Core - Jurjen van de Pol and Fred Pals

 The Netherlands, the fifth-largest euro economy, shouldn't be counted in the core of the common currency as its borrowing costs climb, Citigroup Inc. said.

"The poor performance of the Dutch economy should make it very difficult for the country to reduce its general government deficit," Juergen Michels, chief euro-area economist at Citigroup in London, and three other economists said in a March 23 note to investors. The Netherlands is in a weaker position than Germany, Finland and Luxembourg, he said.

Prime Minister Mark Rutte's minority coalition must find at least 9 billion euros ($12 billion) in budget cuts this year, equal to 1.5 percent of gross domestic product, to meet European Union deficit rules by 2013 and protect the top credit grade that France and Austria lost in January. The Dutch budget shortfall is forecast at 4.6 percent of GDP in 2013, exceeding the 3 percent EU limit for a fifth year.

Note EU-Digest: Look who is calling the kettle black...

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