Monday

20th Nov 2017

Hollande: Germany should do more to boost growth

  • Germany's Angela Merkel should do more to boost growth in Europe, says Paris (Photo: Council of European Union)

French President Francois Hollande has said Germany should do more to support growth as his government struggles to bring its budget deficit to within the EU threshold.

In an interview with Le Monde, published Monday (4 August), he indicated that France was undertaking reforms but needs more support.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

"We are putting in place the reforms announced but the rhythm of the efforts taken to reduce the deficit also depends on growth. We are not asking any leniency from Germany but we are asking that it does more to boost growth."

"Its trade surplus and its financial situation allow it to invest more. That would be the best thing it could do for France and Europe."

He made a similar call for action on the European Central Bank (ECB) saying there was a "real deflationary risk in Europe" and that inflation in France had never been as low as it is now.

"Weak inflation too has negative fiscal consequences on revenues as well as on debt. A lot will depend on the level of the euro, which has weakened over the past few days but not enough," Hollande said. "The ECB must take all necessary measures to inject liquidity in the economy."

The interview is being interpreted in French media as further ground preparation by Paris for warning its partners that it is likely to again have a budget deficit exceeding 3 percent of GDP.

France has already been given two years' grace, from 2013 to 2015, to meet EU rules but its efforts have been hampered by the country's poor economy.

The European Commission has forecast that it will miss its target next year. So far the French government has been insisting it will meet the EU goals but it has also increasingly called for flexibility.

Germany, for its part, is laying more emphasis on growth policies but has not abandoned its focus on reducing budget deficits.

The difference in policy outlook is highlighted by the simmering dispute about which portfolio France's next EU commissioner - Pierre Moscovici - should have.

France - repeated once more by Hollande in the Le Monde interview - is looking for a "large economic portfolio".

However Germany has baulked at Paris taking charge of the economic and monetary affairs dossier, which would give Moscovici discretionary powers over how the euro rules are applied.

German finance minister said the decision on who takes the portfolio is very "sensitive" and carries "symbolic weight".

Germany's mass-selling tabloid also recently weighed in on the debate with a columnist saying that "Moscovici made the euro as soft as French brie with his talk as French finance minister."

Moscovici hit back telling Der Spiegel that he had "initiated key reforms" while he was in office.

The division of portfolios for the next commission is only due to become public around the beginning of September. Other economic portfolios that Moscovici could be in line for include one on promoting growth policies.

Incoming EU commission president Jean-Claude Juncker has said he wants to initiate a €300 billion public-private investment programme to boost the European economy over the coming three years.

MEPs ponder how to fight tax havens

After the Paradise Papers brought new revelations about tax dodging across the globe, including in the EU, the European Parliament wonders how to step up the fight.

MEPs ponder how to fight tax havens

After the Paradise Papers brought new revelations about tax dodging across the globe, including in the EU, the European Parliament wonders how to step up the fight.

News in Brief

  1. European Banking Authority will move to Paris
  2. EU court threatens daily fine over Polish forest logging
  3. EU medicines agency will move to Milan or Amsterdam
  4. Amsterdam, Copenhagen, Milan in next round of EMA vote
  5. Three countries pull out of medicines agency Brexit race
  6. Schulz calls for new German elections
  7. EU Commission 'confident' on German stability
  8. EU adopts new border check rules

Stakeholders' Highlights

  1. Dialogue PlatformErdogan's Most Vulnerable Victims: Women and Children
  2. UNICEFEuropean Parliament Marks World Children's Day by Launching Dialogue With Children
  3. European Jewish CongressAntisemitism in Europe Today: Is It Still a Threat to Free and Open Society?
  4. Counter BalanceNew Report: Juncker Plan Backs Billions in Fossil Fuels and Carbon-Heavy Infrastructure
  5. Nordic Council of MinistersNordic countries prioritise fossil fuel subsidy reform
  6. Mission of China to the EUNew era for China brings new opportunities to all
  7. ACCASmall and Medium Sized Practices Must 'Offer the Whole Package'
  8. UNICEFAhead of the African Union - EU Summit, Survey Highlights Impact of Conflict on Education
  9. Nordic Council of MinistersNordic Council Calls for Closer Co-Operation on Foreign Policy
  10. Swedish EnterprisesTrilogue Negotiations - Striking the Balance Between Transparency and Efficiency
  11. Access EuropeProspects for US-EU Relations Under the Trump Administration - 28 November 2017
  12. Nordic Council of MinistersSustainable Growth the Nordic Way: Climate Solutions for a Sustainable Future