FRANCE:FRENCH PRESIDENT Nicolas Sarkozy has hailed the Brussels deal as a "historic turning point", and said it must lead to a "qualitative jump" towards closer economic integration in the euro zone.
He said Paris and Berlin would make “extremely ambitious” proposals within weeks to strengthen economic governance in the 17-member bloc.
“Our ambition is to seize the Greek crisis to make a qualitative jump in the construction of a system of economic governance of the euro zone,” Mr Sarkozy told reporters. “We can’t keep having a currency disconnected from economic policy.”
Previous European leaders had created a shared currency without putting in place the structures for convergence of economic policy. “There was no European Monetary Fund. We’re not there yet, but it’s progressing, and we have to continue towards that.”
He said the Franco-German plan would include a proposal to create a European ratings agency and would also look at fiscal policy convergence.
“To arrive at this economic integration we have to work on convergence. Naturally, France and Germany, being the two biggest countries in the euro zone, have to lead by example.
“France has fought for a long time for an economic government of the euro zone. That very expression used to be taboo… it has entered the European vocabulary.”
France has long favoured a strengthening of the euro zone as a decision-making entity, seeing it as a more cohesive forum than the 27-member European Council and one where Paris exerts greater influence.
Mr Sarkozy described the relatively recent practice of meetings between heads of state and government from euro zone members as the de facto “economic government” of the zone.
“You have just seen how difficult it is to find agreement in a meeting of 17 states. Can you imagine the difficulty in finding agreement among 27?”
Other steps towards closer fiscal integration are also being actively debated. ECB president Jean-Claude Trichet called in May for the creation of a European finance minister to oversee a more integrated economic and fiscal policy for the euro zone.
French media and commentators generally welcomed the deal, although both frontrunners for the Socialist Party’s presidential nomination, Martine Aubry and François Hollande, said the measures did not go far enough in easing Greece’s debt burden.