now here's a novel thought......balance the budget.
Trichet Says European Deficit Agreement Must Be `Implemented'
By Fabienne Lissak and James Hertling
July 8 (Bloomberg) -- European Central Bank President Jean- Claude Trichet said a three-month old European Union balanced- budget agreement ``must be implemented,'' dismissing French President Nicolas Sarkozy's call to loosen deficit controls.
Trichet's comments in an interview today in Aix-en-Provence, southern France, marked the second time in four days he has indirectly criticized Sarkozy, who has proposed 11 billion euros ($15 billion) of tax cuts to spur economic growth. Sarkozy wants defense spending excluded from deficit calculations for France, Germany, Italy and the U.K.
It's ``very important'' for the European Commission, the ECB and the European Council itself that the Stability and Growth Pact ``be respected,'' Trichet said. EU officials in April agreed to balance their budgets by 2010.
Sarkozy has criticized ECB policy for leading to an ``overvalued'' euro and focusing too narrowly on inflation. The French president has retreated from earlier comments that politicians be more involved in interest-rate policy.
Trichet also reiterated his call for ``structural reform'' in Europe, calling it ``absolutely fundamental.''
Sarkozy will attend the monthly meeting of euro-region finance ministers in Brussels tomorrow to defend his policies. Portuguese Prime Minister Jose Socrates, whose country holds the rotating EU presidency, has urged France to stick to pledges to reduce its deficit.
French Finance Minister Christine Lagarde told reporters today in Aix that Sarkozy will explain his economic policies ``in the context'' of his five-year presidential term, which ends in 2012. Sarkozy has pushed back by two years, to 2012, his predecessor's commitment to reach a balanced budget.
To contact the reporter on this story: James Hertling in Aix-en-Provence, France at jhertling@bloomberg.net . Fabienne Lissak in Aix-en-Provence, France at flissak at Bloomberg.net
Last Updated: July 8, 2007 07:01 EDT |
