The French Government is urging Germany to match the €50bn public spending cuts France recently announced.
The comments, reported by German newspaper Frankfurter Allgemeine Zeitung, come in anticipation of discussions to be held in Berlin over increasing German investment. France’s Finance Minister Michel Sapin is set to accompany Macron in the talks, which form part of plans to strengthen the European economy.
Merkel has already maintained that Germany could not extend its public investment without damaging the balanced budget plans
Macron reportedly said: “€50bn savings for us, and €50bn extra investment for them – that would be a good balance.” He added that investment from Germany “is in our collective interests” and that such a move would not disrupt Chancellor Angela Merkel’s plans to balance the country’s 2015 federal budget – the first of its kind since 1969.
Germany has announced plans to boost transport and infrastructure investment by €5bn. But Merkel has already maintained that Germany could not extend its public investment without damaging the balanced budget plans.
According to Reuters, the country’s Finance Minister Wolfgang Schaeuble likewise said that although bolstering investment is desirable, hindering Germany’s financial goals is a price too high to pay. He stated that balancing the budget is “the only way to inspire confidence”, The West Australian reported. Germany’s projected economic growth for the rest of 2014 and 2015 has been cut as a result of weak domestic demand and a poorly performing eurozone.
The request follows pledges by France to make significant public spending cuts in a bid to meet the EU goal of reducing deficits to three percent. France is still awaiting EU approval for the budget, which sees the country extending the initially set 2015 deadline for the cuts to 2017.