France’s Socialist government has said Paris will stick to its budget deficit target , set by the EU, for 2015 – despite earlier indications that it would seek a delay, reports The Financial Times.
Manuel Valls, who was appointed as prime minister this month to drive a new push for growth, said on a visit to Berlin that France would stick to its commitment to cut the deficit to 3 per cent of output in 2015 “because the word, the credibility of France is in play and no one can doubt the credibility of our country”.
Michel Sapin, finance minister, said earlier in a radio interview: “We are building our budgetary strategy for 2015 on the basis of 3 per cent.”
This line, first signalled by Mr Sapin at the IMF-World Bank spring meeting in Washington at the weekend, is a marked change from clear signals by President François Hollande and the finance minister earlier this month that Paris would seek more time to reach the deficit target as it moved its policy emphasis to pro-business reforms to boost growth.
Although financial markets were unperturbed, the suggestion of more leeway on the deficit drew a frosty response from the European Commission, the EU’s executive arm that had already granted France two delays and was under pressure from Germany and other eurozone partners not to give way.
Read more of this report from The Financial Times.