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Sarkozy calls for intelligent use of eurozone deficit rules |
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08:49, July 10, 2007 |
French President Nicolas Sarkozy called on Monday for intelligent use of eurozone deficit rules to allow his country more time for achieving budget balance.
"I am not asking to put off the effort to consolidate finances. I am asking for intelligent and dynamic use of the stability pact, " Sarkozy told reporters through interpreter after one-hour meeting with finance ministers from the other 12 nations sharing the same currency euro.
Sarkozy said his government will try its best to meet the deadline by eliminating the budget deficit by 2010, but may need two years more due to the ongoing domestic reforms.
"We will deploy every effort to achieve that (budget balance) but at the same time we have to be honest about it ... if we don't do that, we will ask for it to be moved to 2012," he said.
The new French government planned to stimulate the national economy with a series of tax cuts, which might reduce the government revenue in the short term and slow the deficit reduction.
Under the Growth and Stability Pact, eurozone members have to keep their budget deficit under the ceiling of 3.0 percent of their gross domestic products (GDP). And they undertook in April to realize balance of budget by 2010.
In a exceptional move, Sarkozy attended the eurozone finance ministers' meeting in an effort to make his case for backing off from the promise made by the former government, while stressing that France still sticks to the ultimate goal.
"I believe in the (Stability and Growth) Pact, I believe in the necessity of the pact. I believe the reforms should be implemented within the rationale of the pact. Not because the (European) Commission says so but because it's better to have a country that is not in debt," Sarkozy said.
In order to assure other members, Sarkozy said he made a number of concessive commitments, such as to keep deficit at 2.4 percent of GDP in 2007 rather than 2.5 percent, and below 2.4 percent in 2008.
The French government will table an updated stability program in September.
Source: Xinhua
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