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| Europe needs stronger union -France's Fillon |
| Paris, 23.11.2011 |
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| Nov 22 (Reuters) - French Prime Minister Francois Fillon said on Tuesday that closer European integration, including via changes to EU treaties, was necessary to protect the bloc from future economic shocks.
"Today only a very strong intergovernmental union in the hoeart of Europe will allow us to resist the shocks which are shaking the links we have patiently constructed since the second World War," Fillon told a mayors' conference in Paris.
"France and Germany, the Franco-German rapprochement, are at the heart of this tighter intergovernmental union. This is a starting point to lead the entire continent towards a new frontier, a powerful euro zone where economies progressively converge."
odkaz na stránku
French Prime Minister: Deep Treaty Change Needed In Europe
(Update with added comments from French PM, background)
--French Prime Minister says deep European treaty change is necessary
--Debate over role of the ECB is ongoing, says French PM
By William Horobin
Of DOW JONES NEWSWIRES
PARIS -(Dow Jones)- French Prime Minister Francois Fillon Tuesday said the euro zone debt crisis is threatening 60 years of European construction and deep treaty change will be needed in the long term.
Until then, there must be a very strong intergovernmental union to ensure the currency bloc resists the crisis, he told a meeting of French mayors in Paris.
"The whole of Europe has to overcome a political and financial crisis that endangers 60 years of European construction," Fillon said.
The prime minister once again raised the question of changing how the European Central Bank operates. France wants the ECB to have a bigger role in fighting the crisis, saying it should act more as a lender of last resort, like the U.S. Federal Reserve.
The French government has also said the best way to maximize the firepower of the euro zone's bailout mechanism--the European Financial Stability Facility--would be to give it a banking license to allow it to access ECB funding.
Those ideas have met with firm resistance from both the ECB and Germany, the euro zone's largest economy.
"In urgency we are putting in place financial instruments to resist speculation, and respond to investor fears," Fillon said. "That's the aim of the [EFSF], and the debates that are still ongoing on the role of the [ECB]," he said.
Euro zone countriesmust also have rigorous fiscal policies and reduce a dependency on debt that arose from a lack of competitiveness in recent years, the prime minister said.
Fillon said France must focus on cutting spending rather than raising taxes as it strives to save the EUR100 billion necessary to balance government coffers by 2016 after over 30 years of running deficits.
"There is no alternative from cutting our spending and modernizing our structures," he said. The whole of the state, including local authorities, must participate in the effort to cut spending, Fillon told the mayors.
His comments came a day after Moody's Investors Service warned that rising costs and a deteriorating economic outlook were putting pressure on the country's top-grade credit rating.
-By William Horobin, Dow Jones Newswires, +33 1 4017 1740 |
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