Hollande Says Heâll Seek New Fiscal Treaty if Elected in France
The front-runner for the French presidency, the Socialist candidate FranĂ§ois Hollande, said on Wednesday that if elected he would ask other European leaders to renegotiate a fiscal treaty in order to promote growth.
Mr. Hollande also praised the position taken in Brussels on Wednesday by the head of the European Central Bank, Mario Draghi, who said he favored âa growth compactâ of structural reforms in parallel with the fiscal treaty limiting budget deficits and national debt.
But there was little indication that Germany, the driving force behind the austerity-driven fiscal treaty agreed to last month, was warming to his ideas.
In the first news conference of his campaign, Mr. Hollande said that he would propose four modifications to the European Union treaty, favored by Germany and approved in March but not yet ratified. Most significant, perhaps, he called for the creation of collective euro bonds, but to be used to finance industrial infrastructure projects, not to consolidate debt, which the Germans oppose.
He said he would also call for a financial transaction tax, as his rival, President Nicolas Sarkozy has done, and for loosening up regulations to allow unused European Union structural funds to be spent on growth. Finally, he urged the European Investment Bank to place a greater emphasis on job creation in its allocation of financing.
The main risk to Europe now, Mr. Hollande said, âis that the European economy remains in a recession because not enough credit is provided to companies.â He said that increased growth would help shrink debt, and that other European leaders were coming closer to his argument that increased growth is âultimately a more effective way of reaching the same goal of controlling the debt and reducing deficits.â