Solbes warns France on budget sanctions

14th November 2003, Comments 0 comments

FRANKFURT, Nov 14 (AFP) - The European Commissioner for Economic and Monetary Affairs, Pedro Solbes, said in a newspaper interview published Friday that EU budget sanctions should be applied to any eurozone member state that fails to get its finances in order.

FRANKFURT, Nov 14 (AFP) - The European Commissioner for Economic and Monetary Affairs, Pedro Solbes, said in a newspaper interview published Friday that EU budget sanctions should be applied to any eurozone member state that fails to get its finances in order.

No exceptions should be made for governments deemed to be cooperating with the European Commission on measures to rein in their runaway budgets, Solbes told the daily Frankfurt Rundschau.

German Finance Minister Hans Eichel has suggested that France and Germany are making efforts to bring their ballooning public deficits back within EU limits and should therefore be spared the punitive sanctions that would normally apply under EU budget rules.

"Despite all the respect I hold for Mr Eichel, I don't share his point of view," Solbes said.

"The pact cannot be interpreted in this way. If one were to allow such a 'positive' interpretation, it would change the nature of the Stability Pact and we'd have to make political decisions on who is cooperating and who is not."

In the long run, such arguments would reduce the possibility of applying sanctions some time in the future "practically to zero," Solbes argued.

"The pact would be subject to arbitrariness. It would no longer be the pact that EU heads of governments voted unanimously in favour of in 1997," he warned.

Under the terms of the Stability and Growth Pact, eurozone members are not allowed to run up public deficits in excess of 3.0 percent of gross domestic product (GDP), a limit which both Germany and France exceeded last year and look set to do so again this year and next year.


© AFP


Subject: French news







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