France Insists It Is Not the “Sick Man of Europe”
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Finance minister Pierre Moscovici has insisted that France is not the “sick man of Europe”, rejecting growing concerns that the world’s fifth largest economy could become the next victim of the eurozone crisis.
In an interview with the Financial Times, Moscovici said that France did not have to resort to austerity to reach achieve the government’s projection of 0.8 percent growth in 2013 – twice the EU and IMF forecasts.
Finance minister Pierre Moscovici has insisted that France is not the “sick man of Europe”, rejecting growing concerns that the world’s fifth largest economy could become the next victim of the eurozone crisis.
In an interview with the Financial Times, Moscovici said that France did not have to resort to austerity to reach achieve the government’s projection of 0.8 percent growth in 2013 – twice the EU and IMF forecasts.
Asserting that the French economy has “all the resources” and “real potential” to recover from an economic decline, Moscovici said:
[quote] No, we are not implementing the same reforms as Italy and Spain because we are not Italy or Spain. We don’t have the same weaknesses. So we will implement reforms à la Française. They will be more ambitious than any [French government] before us. [/quote]
“The mood has changed,” Moscovici added. “Up until 15 days ago the mood was that France was a country of all the taxes – [people were saying] we have to flee, we’re leaving, we’re leaving. Now the mood is that we are building a contract and we will invest and employ.”
France’s socialist government has been under intense pressure, from its population as well as Germany and international organisations like the International Monetary Fund, to introduce concrete structural reforms that can restore competitiveness and boost economic growth and employment.
While Paris received a relief boost yesterday by official figures showing its economy had eked out growth of 0.2 percent in the third quarter, recent forecasts by the EU statistical agency and the IMF suggest that France’s already stagnant economy could soon tip into recession and will barely grow next year.
France’s German-speaking Prime Minister also tried to reassure Berlin yesterday that his government would reduce the deficit and take steps to ensure that France does not become the next victim of the eurozone crisis.
In his first visit to Berlin since his socialist government came into power, Jean-Marc Ayrault told German Chancellor Angela Merkel that a new French economic model “is underway”.
Extending the French rhetoric, Ayrault said:
[quote] My challenge, the government’s challenge, is to reform what isn’t working, to correct what is too weak, but to keep the profound values that make France what it is. [/quote]
Citing the government’s recent plans to grant companies 20 billion euros in annual tax credits, Ayrault said this was one example of the “courage” displayed by the Socialist government.
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