France, Italy must continue reforms: Eurogroup head

FE Team | Published: April 02, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

ATHENS, Apr 1 (AFP) : France's incoming cabinet and Italy's recently installed new team must stick to reforms to help make Europe more competitive, Eurogroup chief Jeroen Dijsselbloem said on Tuesday.
"We need to continue working on the stabilisation of budgets and at the same time become more competitive," Dijsselbloem told reporters ahead of a eurozone finance ministers' meeting in Athens.
"That requires more reforms, also in France," he added, in a message also directed at Italy.
Late on Monday, French President Francois Hollande announced a change of government, and also hinted that France would seek leniency from the EU Commission in judging its overshooting public deficit.
EU authorities should take account of structural reforms in the making in France when it analysed the deficit, Hollande said.
But Dijsselbloem said on Tuesday: "For all of our countries, we are very gradually moving out of the crisis. The growth per centages are much too low, so we need to do more."
The French public deficit, or gap between spending and revenues, amounted to 4.3 per cent of national output last year, official date showed on Monday.
This is clearly above the government's target of 4.1 per cent, and raises the stakes as Hollande oversees the composition of a new government after a local election debacle on Sunday.
France needs to adjust its accounts by 30 billion euros ($41 billion) to compensate for the easing of business charges under its proposed Responsibility Pact, which is opposed by left-wing parties.
Separately, to meet EU deficit targets, Paris needs to adjust the budget balance by about 20 to 25 billion euros, making for a total adjustment of about 50 billion euros.
In Italy, new Prime Minister Matteo Renzi has announced a 10 billion euro tax cut for low-income families, a move that could put pressure on budget forecasts.
Also on the agenda is Greece, which is hoping to draw some 8.3 billion euros in eurozone loans that are part of its EU-IMF bailout, and which are pending since last year.