Greece/Euro Area – France/Germany/euro crisis

GREECE/EURO AREA

Q. – Does Greece have to stay in the Euro Area at all costs?

THE PRIME MINISTER – The election in Greece shows us that the Greek people opted not to exit from the Euro Area.

Q. – And what if Greece wants to renegotiate the commitments she made?

THE PRIME MINISTER – The Greeks have efforts to make – for example, building a tax system. We have to take account of economic developments over the past few months, especially in terms of growth. Europe will work with the new Greek government.

Q. – Is France a mediator between the countries of the north and south?

THE PRIME MINISTER – It’s in everyone’s interest for the north and south to increase links between them. France can help find acceptable, positive solutions for the north and south and Europe as a whole. What’s certain is that François Hollande’s election has changed the situation in Europe.

Q. – In what way?

THE PRIME MINISTER – The election, by universal suffrage, of a new President of the Republic, then the election of a new parliamentary majority in a major European country is important.

FRANCE/GERMANY/EURO CRISIS

Q. – Your government secured a majority in the general election. Does that change your position towards Germany?

THE PRIME MINISTER – The Franco-German relationship remains the central factor in Europe, as much because of history as because of the current situation. Germans, whatever their political persuasion, respect the vote of the French people, who would like a stable relationship with Germany.

Q. – Can France and Germany agree on rescuing the euro at the next European Council, in Brussels at the end of June?

THE PRIME MINISTER – That’s what we’d like. It’s vital for decisions to come out of the Council which restore people’s confidence and map out the way forward for the European project. Indeed the “European idea”, weakened by euro-crisis-related risks and the lack of growth, must be given its full force. The only answers put forward so far have been austerity plans.

For that reason, there’s a doubt among European peoples, in every one of our nations, about the European project itself – even in Germany, whose debates I’m following closely.

Q. – So for the moment, no pooling, no eurobonds?

THE PRIME MINISTER – I’d like us to talk in Brussels about eurobonds as a prospect. The system of pooling debt demands greater political integration, which is necessary. This will no doubt take several years. However, we must act rather than wait.

First of all, in banking: we must move towards common banking supervision, with a European deposit guarantee system. We can also find solutions to facilitate states’ access to finance, for example through short-term [bond] issues or through the proposal by the German “wise men” on sinking funds. In the very short term, the role of the European Stability Mechanism must be strengthened. It should be able to intervene directly in the banking sector, under appropriate conditions, to prevent excessive indebtedness by states, which is a burden on taxpayers.

Governments are aware of the challenge. It’s a question of ensuring Europe’s financial stability and continuing efforts to control deficits and debt, but also of setting out on the path of growth and employment.

I have no doubt we’ll find an agreement at the next European Council.

Q. – And what if the President of the Commission were elected by universal suffrage?

THE PRIME MINISTER – The democracy issue must indeed be raised. It’s as sensitive in France as in Germany. We must have a democratic guarantee, and that guarantee must be parliamentary in nature. We must thus consider how best to associate national parliaments.

The election of the Commission President by universal suffrage is also a point in the debate, in the knowledge that nation-states aren’t going to disappear. Jacques Delors’ vision of a federation of nation-states is still important today.

Q. – How can we regain the confidence of the markets in the short term?

THE PRIME MINISTER – Let me take the French example. We know our deficit and debt situation. That’s why President Hollande pledged in his campaign to balance the public finances by the end of the five-year term, which will involve a 3% deficit in 2013. Those commitments will be honoured. That’s also why we need growth. The current outlook for the Euro Area as a whole isn’t strong enough. The “growth package” to be discussed at the European Council is essential. For her part, France is embarking on a policy of getting her production back up and running. (…)./.