Chirac sees US deficit threat to world economy

10th June 2004, Comments 0 comments

SEA ISLAND, Georgia, June 9 (AFP) - French President Jacques Chirac warned on Thursday that the yawning US trade and budget deficits pose a threat to a generally bright world economic outlook.

SEA ISLAND, Georgia, June 9 (AFP) - French President Jacques Chirac warned on Thursday that the yawning US trade and budget deficits pose a threat to a generally bright world economic outlook.

Chirac, speaking on the sidelines of a Group of Eight summit hosted by President George W. Bush, said the leaders were "on balance more optimistic" on the outlook for European economies, tipping 2004 growth of at least two percent.

Leaders of the G8 - Britain, Canada, France, Germany, Italy, Japan, Russia and the United States - underscored the "very great strength" of Chinese growth, a good start to Japan's recovery and very strong growth in Russia, he told reporters.

Despite the general optimism, Chirac said he and some other leaders worried about the "possible consequences of the large US budget and trade deficit for the future and notably on interest rate developments."

Bush was aware of the problem, Chirac said.

"We also raised the problems of oil, noting that there are economic, political and technical uncertainties," he said.

Leaders agreed there was a need to reduce energy consumption and develop alternative power.

"I appreciated the fact that the American president praised the French energy policy, which is based to a large extent on acquiring electrical power from nuclear sources," Chirac said.

The US trade deficit grew USD 3.9 billion (EUR 3.3 billion) in March to a record USD 46 billion.

The Bush administration has predicted an unprecedented USD 521 billionbudget deficit for fiscal 2004 ending September 30, but has also vowed to halve it in five years.

© AFP

Subject: French news


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