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Franco-German meeting

Publié le June 16, 2010
Statements by Nicolas Sarkozy, President of the Republic, during his joint press conference with Angela Merkel, Chancellor of Germany (excerpts)
Berlin, June 14, 2010

THE PRESIDENT – I’ll begin by congratulating my German friends on the German football team’s outstanding start in the World Cup. We’re happy for you, it’s even rather spectacular.

Secondly, and more seriously, more than ever, Germany and France are determined to speak with one voice and adopt joint initiatives to give Europe the wherewithal to pursue its legitimate ambitions and take on board the consequences of the financial crises which we keep on having and don’t want any more of.

TORONTO G20/INTERNATIONAL TRANSACTIONS TAX

So as the Chancellor said, we’ve decided to take joint initiatives for the Toronto G20. We’re going to write to Canadian Prime Minister Stephen Harper to ask him to be more ambitious on financial regulation and support a proposal for a financial transactions tax, and we, Germany and France, will support the same proposal calling for the creation of a bank tax which we, Germany and France, will bring in at the same time. So, in Toronto, Germany and France want to get things moving fast.

EU/STABILITY AND GROWTH PACT/SANCTIONS

As regards the European Union, obviously, we have a common position on the need to sustain and strengthen the Pact. On the sanctions [for breaching the Pact], we’re together proposing a suspension of voting rights. Here too, Mrs Merkel and I are going to submit joint proposals to Herman Van Rompuy.

EU GROWTH STRATEGY

On the growth strategy, Mrs Merkel and I will be saying the same thing to Mr Barroso at Thursday’s European Council.

ECONOMIC GOVERNMENT

Finally, I want to express my wholehearted agreement and joy at hearing from the Chancellor’s lips the need to strengthen Europe’s economic government. There’s a problem of coherence which for me is very important. Naturally, this economic government will be in the framework of the 27-member European Council and we agreed that, if necessary, the 16 heads of State and government could meet on issues specifically to do with the Euro Area. Like Mrs Merkel, I’m convinced that the solution to Europe’s problems doesn’t lie in the creation of new institutions, but in the possibility of operational, pragmatic and rapid meetings. And I’d like to end with this: we clearly saw in the crisis that the markets and speculators – they aren’t the same thing – can react in a millionth of a second. Our procedures must be more operational and more pragmatic. Hence a 27-member economic government and, if necessary, meetings on the euro’s problems in the Euro Area. I believe it was very important for Germany and France once again to share a common vision. This is what we’ve done and I thank Angela for her invitation to talks which we’re going to follow with a dinner.

SPANISH BANKS/EU/EUROGROUP SECRETARIAT

Q. – I’d like a comment on the Spaniards who have said that their banks had problems getting financing abroad. Is a European intervention plan possible if the plan to support the Spanish banks isn’t enough? And I’d like to know if in your discussions and the proposals you’re going to make, you’re envisaging the possibility of restructuring the debt of any Euro Area country in difficulty? M. Sarkozy, I deduce that you have given up the idea of there being a secretariat for the Eurogroup as had been rumoured?

(…)

ECONOMIC GOVERNMENT

THE PRESIDENT – On Spain, I totally share the Chancellor’s view and when it comes to what we’ve said regarding the economic government, Mrs Merkel and I discussed in depth the lessons we could learn from the crisis we have experienced. Everyone today agrees on the need for an economic government of Europe, to strengthen economic coherence in Europe. It has, of course, to be a government of the 27, since Europe has got 27 members; but we’ve also chosen to be pragmatic since within the 27 there are 16 countries with the same currency. If necessary, on Euro Area problems, we reserve the possibility of convening a meeting of the 16. Secondly, on the issue of the secretariat, everyone can have ideas on this. There’s one thing Mrs Merkel and I have in common and it’s that we have to be operational and put the institutional debates behind us. In point of fact it was thanks to Mrs Merkel’s presidency that we got Lisbon, and Mr Socrates also played a role and I too lent a hand. What did Mrs Merkel and I say? That Lisbon would be the final stage of the institutional reforms and that afterwards we had to stick to being operational and pragmatic.

STABILITY PACT BREACHES/SANCTIONS/TREATY MODIFICATION

This is the compromise we’ve come up with together and I believe it’s right. Will other changes be possible? Mrs Merkel and I talked about it, there’s the whole question of sanctions. Our teams and we ourselves talked about it and we’re thinking of proposing to Mr Van Rompuy’s group the idea of suspending voting rights as a sanction. There will be a legal analysis. Some people are telling us this requires a modification of the treaties, in this case we will propose it; others tell us it won’t be necessary to modify the treaties, in that case, we won’t make one.

We have chosen to be pragmatic and operational and show a Europe which can react fast and even, if necessary, be proactive, and not get into theological debates which would do us a lot of harm. So the natural area for this economic government is the 27, but if there’s a problem in the Euro Area we will meet in the Euro Area framework. And we both agreed that it was better to simplify the European systems by not increasing the number of institutions and opt for pragmatism. I think that by doing this we each took a step towards the other. And the whole of Europe and – sorry for saying this – perhaps even beyond Europe, people were waiting for Germany and France to find an agreement on taking on board the consequences of the crisis which Europe and the world have experienced. That’s exactly what we succeeded in doing.

(…)

GERMAN AUSTERITY BUDGET/FRENCH PLAN

Q. – The Chancellor talked about the need for an improved and consolidated budget. You yourself, President Sarkozy, have just talked about frankness. So does the German government’s austerity plan worry you? Chancellor Merkel, does the French plan reassure you?
(…)
THE PRESIDENT – It’s absolutely not my place to get involved in the German political debate. I understand perfectly the Chancellor’s economic and budgetary policy, and indeed can’t see how she could be criticized for it. As regards France, I’ve now been President of the Republic for three years and it was I who put in place the policy of not replacing one of every two retiring civil servants – 100,000 fewer civil servants in France in three years – I who announced the need for pension reform even before the recent crisis we’ve seen in Greece, and our proposal will be known on Wednesday morning. Also, you can clearly see everything I’m trying to do so that France has a reasonable policy and the goals of cutting the deficits and public spending are strictly maintained. So on this subject too, the Chancellor and I are moving hand in hand. It can’t be otherwise. It’s a responsibility France and Germany, Germany and France share. What’s more, as well as our countless meetings, we talk regularly on the phone. Our teams work together. I was aware of what was happening here and Mrs Merkel knows the exact content of the proposed pension reform in France and that of the 2011 budget. It’s a matter of confidence and proximity.

We’re working hand in hand. Let me add that I don’t know a single head of government whose situation is so easy that he can allow himself to work without the support of the others.

ECONOMIC GOVERNMENT

Q. – President Sarkozy, you talked about an economic government. In the long term, in Europe will that lead to transfers between rich and poor countries?

THE PRESIDENT – As the Chancellor said, the aim of the economic policy is to have a growth strategy so that Europe and its model can prosper in the world, and ensure consistency in the economic, financial and budgetary policies of the 27 so that we move forward together in the same direction. (…)./.

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