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French president Nicolas Sarkozy is to press ahead with the "fiscal shock" plans for his country despite strong reservations from several other eurozone countries. In an unusual move, the energetic new leader invited himself to a meeting of euro finance ministers last night (9 July) to personally sell his plans for the French economy, amid mounting criticism over the past weeks. The heated meeting, which saw Germany among the countries opposed to his tax-cutting measures, resulted in Mr Sarkozy presenting a softer line on his plans but not abandoning them. At a press conference after the meeting, the French president called for an "intelligent and dynamic application" of the stability and growth pact, the rules underpinning the euro. Referring to his plans to postpone balancing the country's books from 2010 to 2012 - he said he is not asking for the euro rules to be bent specifically for France.
Despite a promise to step up France's role in the European Union, French President Nicolas Sarkozy risks riling Paris' partners in the euro zone on Monday over his economic policies. True to his image as a whirlwind of activity, the new French leader has invited himself to a regular dinner meeting on Monday of finance ministers from the 13 countries sharing the euro."This unusual move should be seen as an attempt to add political weight to help smooth the discussion of his plan to delay by two years the elimination of the public deficit in France," said Bank of America economist Gilles Moec.In addition to making his case for pushing back the previous government's commitment to balance the state accounts by 2010, Sarkozy is also due to flesh out his plans for giving a higher political profile to the euro zone.However, both initiatives could prove to be contentious, especially with Germany, which is making big efforts to balance its books and is suspicious of Sarkozy's push for more "economic governance" for the euro zone.
True to his image as a whirlwind of activity, the new French leader has invited himself to a regular dinner meeting on Monday of finance ministers from the 13 countries sharing the euro."This unusual move should be seen as an attempt to add political weight to help smooth the discussion of his plan to delay by two years the elimination of the public deficit in France," said Bank of America economist Gilles Moec.In addition to making his case for pushing back the previous government's commitment to balance the state accounts by 2010, Sarkozy is also due to flesh out his plans for giving a higher political profile to the euro zone.However, both initiatives could prove to be contentious, especially with Germany, which is making big efforts to balance its books and is suspicious of Sarkozy's push for more "economic governance" for the euro zone.
The European Union on Tuesday talked up its commitment to budgetary discipline, the day after Nicolas Sarkozy, French president, confirmed he expected to delay by two years his country's delivery of a balanced budget.Mr Sarkozy's new 2012 target date for eliminating the French deficit is the latest in a series of slipping deadlines set by Paris. Five years ago the target was set at 2004, later at 2007 and in April this year the goal was set at 2010. But Mr Sarkozy's appearance before finance ministers in Brussels and his constructive tone offered some reassurance to critics who attacked him in strong terms during a tense dinner on Monday night.Mr Sarkozy promised that if growth was higher than expected, he might still be able to hit the 2010 date and argued that his ambitious reform programme would inevitably incur upfront costs.Joaquín Almunia, EU monetary affairs commissioner, on Tuesday said the debate confirmed that the 13-member eurozone was intent on sticking to the 2010 target. He added that the remodelled stability and growth pact - the EU's fiscal code - had been "strengthened by what we heard yesterday".
The European Union on Tuesday talked up its commitment to budgetary discipline, the day after Nicolas Sarkozy, French president, confirmed he expected to delay by two years his country's delivery of a balanced budget.
Mr Sarkozy's new 2012 target date for eliminating the French deficit is the latest in a series of slipping deadlines set by Paris. Five years ago the target was set at 2004, later at 2007 and in April this year the goal was set at 2010. But Mr Sarkozy's appearance before finance ministers in Brussels and his constructive tone offered some reassurance to critics who attacked him in strong terms during a tense dinner on Monday night.
Mr Sarkozy promised that if growth was higher than expected, he might still be able to hit the 2010 date and argued that his ambitious reform programme would inevitably incur upfront costs.
Joaquín Almunia, EU monetary affairs commissioner, on Tuesday said the debate confirmed that the 13-member eurozone was intent on sticking to the 2010 target. He added that the remodelled stability and growth pact - the EU's fiscal code - had been "strengthened by what we heard yesterday".
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