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France tells Germany: we need growth too

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France tells Germany: we need growth too
Photo: DPA
14:14 CEST+02:00
As Germany and France clash over how to move Europe's economy forward, the French Finance Minister told Germany's counterpart, Wolfgang Schäuble, that committing to fiscal discipline must not stall growth.

Pierre Moscovici said on Tuesday that his government was committed to fiscal discipline but stressed “we must ensure that public finances recover," during a Berlin panel discussion with his Schäuble.

"But we need to carry out this exercise carefully, taking into account national circumstances, and finding the right rhythm to preserve growth prospects."

The comments come at a time of tension between the eurozone's two biggest economic powers, as Berlin has stressed the need for belt-tightening to make growth sustainable while Paris has pushed for more public spending to kick-start the economy.

Moscovici rejected worries that France would slacken off in implementing reforms, saying that when it came to reducing the structural deficit, "this promise will be kept."

The European Commission has given France two more years to bring its deficit under the EU limit of three percent of gross domestic product, and Schäuble has voiced understanding for the move, provided that reforms continue.

 

The ministers were speaking at Berlin's Free University on the 25th anniversary of a bilateral financial and economic council.

Both ministers stressed that their countries are at the core of a united, interdependent Europe, but their meeting came as relations have soured between the centre-right government of Chancellor Angela Merkel and France's Socialist President Francoise Hollande.

A leaked draft document from the French Socialist party recently attacked "austerity chancellor" Merkel for her "selfish intransigence" before the text was amended.

Hollande has contested claims that he had put cooperation with Merkel on ice until after Germany's September general election and praised the chancellor, a German news weekly reported Sunday.

AFP/The Local

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