France ‘must cut deficit’ below 3% of GDP

European Central Bank executive board member Joerg Asmussen said on Friday that France needed to bring its budget deficit back down to within three per cent of its gross domestic product this year.

Speaking two days after France’s Prime Minister said the country would miss that target, Asmussen said he believed Paris and Berlin “as the core of the eurozone, have a special responsibility both for the stability of the currency and for upholding the EU stability and growth pact.”

“I personally think it is very important that France keeps its deficit below three per cent this year,” Asmussen told Germany’s Deutschlandfunk radio, adding that Germany and France needed to set an example to other EU states.

French PM Jean-Marc Ayrault said on Wednesday an economic slowdown meant France would fail to cut its public deficit from 4.5 per cent of output in 2012 to three per cent – which is the official EU ceiling – this year.

On Thursday, Olli Rehn, the EU’s top economic official, told finance ministers eurozone countries could have extra time to meet deficit-cutting goals if the growth outlook deteriorates.