Brussels, 14/10/2003 (Agence Europe) - In an interview published on Tuesday by Italian daily Il Sole 24 Ore, Commissioner Pedro Solbes admitted that the European Commission would not be able to demand that France bring its state deficit below 3% of GDP from 2004. "This is why we will ask for a relatively major effort to reduce the structural deficit, in order to get a gradual return to the balance, and to balance out the lack of success in 2003", explained the Commissioner. These statements seem to echo the results of the latest Eurogroup meeting, which the parties showed themselves to be seeking a compromise solution (see EUROPE of 8 October, p.7).
Having said last week that France had failed to respect the injunctions of last June's Ecofin Council, the Commission is to adopt a new recommendation on 21 October giving France a certain time-limit to take steps to remedy the situation of excessive deficit (EUROPE of 9 October, p.6). The Ecofin Council will decide on 4 November what specific requirements France will have to put into practice to avoid penalties.
Mr Solbes said in the same newspaper that the Euro's rise against the dollar tends to confirm the prospects for economic recovery in Europe next year. This increase in the Euro also permits interest rates to be lowered, said the Commissioner. He recognised that any further decline in the dollar's fortunes against the Euro could have negative consequences on the EU's external trade, but pointed out that the lion's share of commercial exchanges are carried out between Member States of the EU.