ZCZC
BCN-20
FRANCE-UE-DEBT
‘Limited’ French breach of EU deficit limit ‘acceptable’: Moscovici
PARIS, Dec 22, 2018 (BSS/AFP) – European Economic Affairs Commissioner
Pierre Moscovici on Friday said France’s likely breach next year of the EU-
mandated deficit limit of 3.0 percent of GDP would be “acceptable” providing
it was “limited”.
“The French deficit as forecast (by the government) today should reach 3.2
percent (of GDP) in 2019; I think such a figure is not unrealistic,”
Moscovici told Public Senat television.
“3.2 percent is a high figure, above the well-known 3 percent figure,” the
former French finance and economy minister said, adding that France would be
the only EU country to breach the limit next year.
He stressed that there was no defined sanction in case of a “temporary”
breach of the 3 percent ceiling, providing it did not last more than a year.
“Providing this breach is temporary, exceptional and, I should add,
limited, it is acceptable,” he said.
But he also warned France against allowing its overall public debt —
currently hovering close to 100 percent of GDP — to balloon, saying the
country cannot “live long with such a high public debt level”.
Asked about the “yellow vest” crisis, which has seen hundreds of thousands
of protesters in high-visibility jackets take to the streets over high taxes
and declining living standards, Moscovici said it was understandable that the
government had to find money to deal “with a cost-of-living emergency”.
But the government’s extra spending would have to be limited and public
finances “strategically” reassessed, he said.
France’s lower house of parliament on Friday approved a package of
emergency measures announced by President Emmanuel Macron last week in a bid
to end the “yellow vest” protests, which have repeatedly turned violent.
The measures, which will cost some 10 billion euros ($11.4 billion),
include the removal of a planned tax increase for a majority of pensioners,
tax-free overtime pay for all workers, and an income increase for some five
million people on the minimum wage.
BSS/AFP/HR/1125