Keyword: fiscal compact

French PM Ayrault slams 'lack of vision' over euro crisis, calls for breathing space for Greece and defends fiscal compact

Jean-Marc Ayrault : " l'Europe est un combat " © Mediapart

In this first part of a wide-ranging exclusive interview with Mediapart, French Prime Minister Jean-Marc pledges his government will do its all to keep the euro alive, argues that a delay should be given to Greece to meet its deficit target and answers mounting criticism that he and President François Hollande have capitulated their pro-growth policies with the adoption, without any compromise, of the austerity-promoting European Treaty on Stability, Cooperation and Governance, the TSCG. The French Prime Minister, in an interview conducted in French and translated here into English, calls on the treaty’s opponents to come clean that they want to leave the euro, and claims the election of President Hollande has announced a re-orientation of European policy-making. “I am convinced there has been an enormous degree of political weakness and lack of vision since the start of the crisis,” he comments, adding that European leaders are “beginning to be conscious of the major risks into which we will be plunged if Greece leaves the euro.”

Leading French economists sound alarm over Hollande's deficit target

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Ahead of a vote in parliament next month, the French cabinet on Wednesday approved adoption of the European fiscal treaty, the TSCG, which will require governments to limit their public deficits to 0.5 percent of gross domestic product. To prepare to meet the target, French President François Hollande has pledged to reduce the country’s huge public deficit to 3% of gross domestic product (GDP) in 2013, with a raft of spending cuts and tax increases contained in a new public finances law to be presented before parliament on September 28th. It represents the most severe austerity programme to be introduced in France for 50 years. But a number of leading French economists, including several who publicly supported Hollande’s election campaign, now warn of the potentially catastrophic effects of the tough austerity programme. They argue that the policies will further starve economic growth and thereby simply worsen public finances, leading to a never-ending spiral of recession and austerity. Lénaïg Bredoux reports.

French government readies adoption of fiscal compact

The French socialist government on Wednesday begins ratification process of a European Union budget discipline pact despite dissent on the Left.

Germany refuses Hollande re-negotiation of EU fiscal pact

Germany rules out reworking the European Union's 'fiskalpakt' despite calls to do so by Francois Hollande, France's president-elect.