Germany and France pledge to accelerate eurozone reforms
Finance ministers consider boosting co-operation between top companies
Germany and France are considering boosting co-operation between their largest companies as part of an initiative started by Chancellor Angela Merkel and President Emmanuel Macron to strengthen bilateral relations and revive the eurozone economy.
Wolfgang Schäuble, Germany’s finance minister, and Bruno Le Maire, his new French counterpart, announced the proposal on Monday among plans to improve economic policy co-ordination and accelerate eurozone reforms.
Paris and Berlin want urgently to improve ties following Mr Macron’s election as president. Mr Macron met Ms Merkel the day after his inauguration last week.
Mr Schäuble and Mr Le Maire said in a joint statement that “deeper co-ordination and integration of economic policy is needed in order to achieve real economic convergence” in the eurozone.
“Despite the currently strengthening economic recovery in the eurozone, not all member states have recovered completely from the last crisis, and the eurozone is economically vulnerable due to major macroeconomic imbalances, low core inflation and significant financial fragmentation,” they said.
Emphasising the role of French-German relations as the EU’s motor, the ministers said they planned to develop “common bilateral initiatives which could pave the way for future European policy”.
Talks “could include a consultation process involving national companies so as to improve German-French economic co-operation”, the statement said.
A working group will report to a joint Franco-German cabinet meeting in July.
The ministers did not specify how business would be consulted. However, there is speculation that Mr Macron’s calls for boosting eurozone investment could include Franco-German projects in the digital economy and in energy.
The talk of co-operation in energy follows reports that energy companies RWE and Engie are looking at a possible share swap that would create a €50bn Franco-German group.
The two countries have long talked about an energy alliance but investment bankers stressed that any combination was unlikely ahead of German elections in September.
Other ideas for strengthening the eurozone include completing its banking union as well as reviving proposals for corporate tax harmonisation in the EU. Mr Schäuble said Germany and France could either propose a joint corporate tax or concentrate on pushing ahead with efforts to create a harmonised basis for assessing European corporate tax.
Mr Le Maire said: “We’ve been talking for years about progress in integrating the eurozone, but things aren’t advancing quickly enough or far enough. We are determined to get things moving faster and further.”
Mr Le Maire, who was on his first official foreign visit, spoke partly in German at a joint press conference with Mr Schäuble, as if to emphasise the new spirit of co-operation that Paris and Berlin want to inject into their relationship.
Edouard Philippe, the new French prime minister, is also a fluent German speaker, as is Philippe Etienne, the former French ambassador to Berlin who is Mr Macron’s top foreign policy adviser.
Mr Le Maire repeated Mr Macron’s pledge to reform the French economy, saying that France would respect its commitments to reduce its deficit and public debt. “We are not doing this to please Europe or the European Commission or Germany. But we are doing it because it’s good for France.”