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France/Germany/Euro Area crisis

Published on October 26, 2011
Statements by Nicolas Sarkozy, President of the Republic, at his joint press conference with Angela Merkel, Chancellor of Germany (excerpts)

Brussels, October 23, 2011

THE PRESIDENT – Thank you, Angela. As you well understand, if Chancellor Merkel and I spend so much time in meetings together, on the telephone, in contact with all our partners, it’s because it is crucial – given the unprecedented financial crisis the euro is facing – that France and Germany speak with one voice and express the desire for the same policy. That’s the absolute bedrock of everything, and the Chancellor and I are totally, utterly determined to provide common, ambitious, sustainable responses on all the subjects we’re facing.

I’d like to say that they’re subjects of considerable technical complexity. They’re complex because they demand a huge amount of money. They’re complex because they involve other – in particular private – partners with whom we must reach agreement on a voluntary basis. They’re complex because we’re talking about the 17 Euro Area countries. And they’re complex because all the institutions – the Central Bank, which is independent, the Commission, the IMF, the Council presidency – and all the participating states must show the same determination.

There have been hours and hours of discussions. The work is making good progress on the banks, the European Financial Stability Facility and the possibility of using that Facility. Positions are getting closer and quite a broad agreement is emerging. On the question of Greece, things are moving forward.

We haven’t finished yet – we have until Wednesday – but you must understand that all the decisions will be taken at the same time. In addition to that, the Chancellor and I met the Italian Prime Minister. We’ll also be meeting the Greek Prime Minister, because we must take a whole raft of measures. But the countries concerned, too, must be conscious of their responsibilities and the new decisions they’ll have to take.

That, ladies and gentlemen, is how we’ve spent our time so far, and we’ll be having many more hours of discussions, but we’re aware of the special responsibility that falls on the shoulders of Germany and France.

We’re determined an agreement should be reached on Wednesday that calms the financial crisis, and this will enable us to prepare with Germany for the G20 summit, where other decisions must be taken to regulate globalization and allow the world to get back onto the path of global growth.

Q. – A question for both of you. You’ve now been at the helm for two years, trying to resolve the Euro Area crisis. For two years we’ve been hearing you say you’re going to find common, ambitious, sustainable solutions. And you fail every time. The crisis gets more serious every time: Ireland, Portugal, Spain, Italy. So how can we still believe you today when you announce to us that you’re going to find solutions that will resolve the crisis?

THE PRESIDENT – Let me tell you I totally disagree with your analysis, and I’m making allowances for a spectator being provocative about the players’ duty of responsibility. It’s doubtless easier to comment than to take action, and you wouldn’t be the first person in that situation. But I can’t let you say things have failed.

Ireland was a country on the brink of bankruptcy at the time of the 2008 crisis. Ireland is now a country that has emerged, or is on the way to emerging, from the crisis. That’s one point that is indisputable.
Regarding Portugal, thanks to the Portuguese government’s efforts things are heading in the right direction.

As for Spain, thanks to the efforts of Mr Zapatero’s government and the sense of responsibility of Mr Mariano Rajoy’s Spanish opposition, Spain is no longer in the front line.

There you are: three countries to which Europe has provided credible resolution proposals. Let me add that regarding the 2008 crisis – which was caused by what happened with Lehman Brothers in the United States – it was Europe that proposed the G20. And all the moves on Basel III, on eliminating tax havens and on regulating the financial markets made it possible to respond to the 2008 crisis. We’re facing a new crisis. Oh really? And thank you for thinking we must also be responsible for the indebtedness of all the developed countries, built up over the past 30 years.

I don’t remember Chancellor Merkel and I already being in office when all those countries chose to be indebted, or even when the decision was taken to allow into Europe and the Euro Area countries that didn’t meet any of the criteria demanded at the time.

Let me add that I don’t think it was Mrs Merkel or I who asked for the pact to be relaxed at the time. We’ve got to deal with the consequences of those who brought certain countries into the Euro Area that weren’t ready and who relaxed the discipline on the pact.

Let me finally add one last point: namely, that Mrs Merkel is responsible for Germany, I’m responsible for France and today we find ourselves having to take decisions to support countries we weren’t elected for. And anyone can understand this also raises democratic problems. By that I mean – and I’ll finish on this point – that there aren’t only technical problems, financial problems: these are countries where there’s been a lot of suffering, where there are demonstrations and social problems. It’s not our mandate to run these countries, and yet we have to ask them to make some efforts. So I think that instead of making the remark you made, perhaps you could have said: ultimately, if Germany and France hadn’t decided to shoulder their responsibilities, where would we be today? (…)./.

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