PARIS May 4 European Union Internal Market
Commissioner Michel Barnier, the EU's top financial regulator,
called on the French government to pursue its planned reforms
despite the Commission allowing two more years to meet its
budget deficit target.
Olli Rehn, the European monetary affairs commissioner, said
on Friday France badly needed to unlock its growth potential and
create jobs, adding Spain, Italy and the Netherlands as well as
France - four of the euro zone's five largest economies - would
remain in recession this year.
France - which restated on Friday it would bring the deficit
below 3 percent in 2014, only one year later than the original
deadline - must pursue its retirement and labour reforms to
boost its competitiveness and to overcome its unemployment
crisis, Barnier said.
"It's a moment of truth for the government which needs to
have the political courage to carry out those reforms which will
sometimes not be understood, and require effort," he told French
radio Europe 1 in an interview.
EU finance ministers had given France until this year to
bring down its budget shortfall below 3 percent of GDP and set
the deadline for Spain for 2014. But while France expects its
economy to expand by 0.1 percent this year, the European
Commission forecast a 0.1 percent contraction.
Granting more time is a victory for French President
Francois Hollande, who won elections promising a focus on growth
and less on austerity but has little to show for his economic
policies after a year in office.