Brussels, 16/09/2002 (Agence Europe) - French Prime Minister Jean-Pierre Raffarin gained Romano Prodi's support on Monday, in Brussels, to the request for lowering VAT on catering and sound recordings. During a press conference, both men, who met for the first time since the right wing victory at the French legislative elections in June and who decided to meet again every three months, appeared to be on the same wave length on the subject of enlargement, the future of the European institutions and the development of research initiatives. The only real bone of contention was Common Agricultural Policy (CAP) on which France recalled that it refused to commit itself to reform before 2006.
Although the two discussion partners refused to speak before the press, the rise in public deficits was also discussed during lunch. Mr Raffarin confided to Romano Prodi that they must keep on course, according to diplomatic sources. The French Prime Minister is also reported to have said that his country will do the maximum, in everyone's interest. France had made its commitment to the 2004 deadline subject to 3% growth annually in 2003 and 2004, but Mr Raffarin admitted that ten days ago this result seemed scarcely plausible, at least for 2003.
The fall in VAT in catering or cultural goods would, says Paris, allow jobs to be boosted in a sector where labour is unqualified. "The debate on the reduced rate of VAT in catering is a priority, it is a very important subject for employment, it is very important for all European countries to have the same way of looking at things (developing our economy through added value and also through services)", said Mr Raffarin with determination. He noted that Mr Prodi "was not opposed to this position (…) which I am delighted about and which comforts me in the combat that we are conducting to convince all of our partners". "The Commission raises no objection of principle to the fact that catering should appear on the list proposed by the Council, but the rule of unanimity makes this solution difficult", said Mr Prodi, who proposed finalising a strong strategy on this issue. He recommended a simple and coherent system for reduced rates. The Commission president specified that, in 2003, "we shall have an overall review of reduced rates, and the question of high labour intensive services will be duly taken into account, because it is not solely a problem for France but for the whole of Europe". In his view, it will also be necessary to have a "sound" economic justification.
The other subjects raised t the press conference are as follows:
Common agricultural policy: "I recalled that our proposal (the mid-term review of the CAP) means no alteration to the financial amounts granted to agriculture until 2006. We thus was to continue to guarantee farmers, including through the reform, a fair revenue and support their export possibilities", declared Prodi, stressing however that "we are not deaf to the expectations of our society: otherwise, farmers would lose the backing of the taxpayers." "France wants the respect of the deadlines and commitments of Berlin; France is not conservative, France is turned towards the perspective of evolution beyond 2006 in agreement with its partners", Mr. Raffarin recalled, for whom, "the deadlines that were defined in Berlin are unmovable for us".
Enlargement: Mr. Prodi recalled that the Commission would tell the European Council in October which countries it considers ready for accession. "the agenda is realistic, we have noted that we are ready to make this major step", welcomed Prodi, saying that he expected of the European Council of Brussels an agreement on budgetary questions, including direct farm aid. "We are in the process of overcoming all the obstacles that opposed a final decision on enlargement (….) Of course, some problems remain, like the Irish referendum subject over which the Commission has no possibility of intervening". Regarding the "grand rendez-vous of 2004", Mr. Raffarin repeated that two deadlines (enlargement and new institutional situation) were strategic subjects for the EU in which France "feels fully involved".
Raffarin said that the French wanted enlargement, indeed it was part of their strategy in Europe. He added that they were aware of the problems but also wanted to turn enlargement into true hope for the European dynamic. Turing to the European Commission, the prime minister said France wanted the European institutions to give the European Union strength, and with this in mind, France favoured the Commission having an important role and for the Council to have a full strategic role in the European Union.
Answering a question on integrating candidate countries into the CAP, Raffarin said it was important to ensure they were able to join the EU in conditions that were both dignified socially and satisfactory economically. Europe shouldn't be selfish, he said, which is why France didn't want the CAP to appear on a sliding scale with regard to enlargement. He explained that success had to be made of enlargement, ensuring that candidate countries' contributions and interests were balanced.
Raffarin expressed disapproval of the Baghdad visit by three French majority MPs from Union pour la Majorité Présidentielle (Thierry Mariani, Didier Julia and Eric Diard), which he said did not form part of France's position in the particularly tense international situation. He explained the MEPs visit was their personal initiative.