Macron and Draghi plead for budgetary leeway

PARIS (Reuters) – Emmanuel Macron and Mario Draghi plead in a joint column published by the Financial Times for a future reform of the European Union’s budgetary rules to provide more leeway for the investments necessary to adapt the economy. economy to climate change and greater European sovereignty.

The COVID-19 pandemic and the policies implemented to help businesses and households worsened the deterioration of the public accounts of European countries, many of which no longer respected the authorized ceilings in terms of deficit and especially debt.

This health and economic crisis has also exposed the dependence of certain industries on the rest of the world with the appearance of bottlenecks in the supply chains.

“We must reduce our level of debt, there is no doubt about it, but we cannot hope to achieve this goal by raising taxes or making unsustainable cuts in social spending, nor killing growth in social spending. egg by rebalancing public finances by a budgetary adjustment which would not be viable “, wrote Emmanuel Macron and Mario Draghi in this forum, of which the other European leaders were informed before its publication according to Elyse.

The French president and the president of the Italian council rather present a strategy consisting of “controlling our recurrent public expenditure by carrying out intelligent structural reforms”.

“(…) in the same way that these (budgetary) rules did not restrain our response to the pandemic, they should not now prevent us from making all the necessary investments.”

During the presentation on December 9 of the priorities of the French presidency of the Council of the European Union in the first half of 2022, Emmanuel Macron had already made a similar speech. Mario Draghi has also repeatedly defended a reform of European budgetary rules resulting from the Maastricht Treaty.

“We must have more room for maneuver and be able to carry out the key expenses necessary for our future and our sovereignty”, wrote the two leaders in the Financial Times.

“Budget rules should favor the debt created to finance these investments, which undeniably contribute to the well-being of future generations and long-term growth, as long as these public expenditures contribute to long-term debt sustainability.”

(Report Tassilo Hummel and Sudip Kar-Gupta, French version Bertrand Boucey, said by Jean-Stphane Brosse)

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