The French government’s renewed commitment to bring its budget deficit in line with an EU limit is good not only for France but for upcoming eurozone discussions on budgets, ECB Executive Board member Benoit Coeure said on Sunday.
The French government has committed to stick to plans to cut the deficit to 3% of economic output this year despite overspending this year by its predecessor, Reuters reported.
“One of the constraints facing the government is to keep its commitments on the budget and in particular on the 3%. This is something that we welcome in part because of the consequences for the rest of Europe,” Coeure said.
Speaking at an economics conference in southern France, Coeure said that France’s respect for the rules would help discussions the government hopes to launch soon about common budget measures in the eurozone. “You can’t tell others what to do if you don’t respect the rules yourself,” Coeure said.
Speaking at the same conference, French Finance Minister Bruno Le Maire said that the government could cut spending and taxes at the same time. “It’s because the ECB’s monetary policy is accommodative that we must without delay launch the transformation of our economy,” he said.
Le Maire also said no final decision on the timeframe for the tax cuts promised by President Emmanuel Macron during the campaign had been taken, suggesting the one-year delay announced by the French prime minister this week could still budge.
“No definitive decision has been taken on the timeframe for now,” Le Maire told reporters on the sidelines of a conference in the southern French city of Aix-en-Provence.
