Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor

Portfolio > Economy & Markets

French Cabinet OKs EU Fiscal Pact

By Marlene Y. Satter

X
Your article was successfully shared with the contacts you provided.

France took the first step in approving the European Union’s fiscal pact, despite opposition from a public tired of austerity and members of President Francois Hollande’s coalition government who oppose its measures.

Reuters reported Wednesday that the pact, which was agreed to in March by Hollande’s predecessor Nicolas Sarkozy, requires countries in the bloc to adhere to budgetary discipline that will require France to cut its deficit to only 3% of GDP. Approval by the cabinet is just a preliminary; Parliament must still give the go-ahead, even as the measure’s popularity sinks.

However, support for the EU is waning in France as people weary of cutbacks and high unemployment. In fact, a survey released Monday indicated that almost two-thirds of voters would now reject the 1992 Maastricht Treaty that led to the euro. European Affairs Minister Bernard Cazeneuve commented on the poll’s results Tuesday, saying in the report, “The public is falling out of love with the European Union.”

If at least 12 countries in the 17-nation currency bloc give the go-ahead by Jan. 1, the pact will go into effect. Six countries, including Germany, have already signed on.

The pact is, however, seen as a means of attacking the eurozone debt crisis by compelling member countries to get their fiscal houses in order. Public deficits must be cut or countries will be penalized by sanctions that could include fines.

Prime Minister Jean-Marc Ayrault, whose cabinet approved the pact on Wednesday, hoped for more enthusiasm from the broader Parliament. In the report he was quoted saying, “There are still waverers and those who are hostile … My objective, and the government’s, is to convince the highest number possible. Parliament’s approval, which I hope will be massive, will give even more force to the president’s voice in European negotiations.”

However, some Socialist members of the government will almost certainly vote against it. Still, fighting the crisis is seen as essential. “We don’t like this pact, it is a Sarkozy legacy,” said Elisabeth Guigou in the report. Guigou, who is head of Parliament’s foreign affairs committee and one of the senior Socialists responsible for wooing support among the governing coalition for the pact, added, “But you don’t have to love a pact to ratify it. It’s one part of a deal and just the first step.”

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.