G20/Euro Area/global economy
At the annual meetings of the International Monetary Fund and the World Bank, we discussed the situation, which everyone described as serious and which requires us to coordinate a collective, global response both to resolve problems of instability in a number of areas – especially the Euro Area – and create the conditions for a framework for sustainable, balanced, strong growth shared by all, with social elements called for by the French presidency – as you said – at the summit taking place in Cannes at the beginning of November under France’s presidency.
We began by agreeing on the diagnosis. There have been three crises in a row over the past four years.
A first crisis – the subprime crisis – whose epicentre was in the United States.
A second crisis – the first aftershock – with Lehman Brothers, which led to the collapse of the banking system, whose epicentre was also in the United States.
A third crisis – the second aftershock – which we’re going through today and is a consequence of the previous two. To protect people’s savings and sustained economic activity by safeguarding the banking system, states agreed to shoulder the burden of private debt turned into public debt, and so it’s really this public debt we have to settle today.
This is the case in France; it’s the thrust of the budget being presented tomorrow under the Prime Minister’s authority, in the presence of President Sarkozy, at the Council of Ministers, a budget which will build on the efforts of multiannual strategies for savings, expenditure control and [budgetary] adjustment to growth. This is also the thrust of what’s being done in the United States under the Obama presidency in the savings plan. It’s the thrust of what we’re doing collectively through the 21 July agreement to stabilize the Euro Area./.