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fiscal treaty

Hollande says he would seek to renegotiate Fiscal Treaty if elected

Hollande says he wants the pact to include a financial transaction tax and eurobonds — government bonds jointly issued by all 17 eurozone countries — to finance infrastructure projects.

FRENCH PRESIDENTIAL CANDIDATE Francois Hollande says that, if he is elected, he would immediately ask other European leaders to renegotiate the fiscal treaty aimed at reducing debts to include measures to encourage growth.

Hollande also shrugged off worries that his election 6 May would send markets into panic, called for a more active role by the European Central Bank and said he’d move swiftly to get French troops out of Afghanistan.

Polls suggest Hollande will win the election, unseating conservative President Nicolas Sarkozy, who has been blamed for losing touch with French voters and failing to create jobs in a five-year term marked by financial crisis.

In a wide-ranging news conference Wednesday, Hollande said he would focus first on Europe.

If elected, he said he would send a letter the next day to the leaders of the other 26 European Union members proposing a “growth pact” to add to the existing treaty, which was signed earlier this year and focuses on tightening budgets as a way to restore market confidence in the 17-country eurozone.

Financial transaction tax and eurobonds

Hollande wants the growth pact to include a financial transaction tax and eurobonds — government bonds jointly issued by all 17 countries that use the euro — to finance infrastructure projects.

“The main risk right now to the European economy is that we remain in recession because we haven’t freed up enough financing for companies,” Hollande said, adding that he’d also seek to open “a dialogue” between EU leaders and the Europe’s central bank on the issue.

Hollande’s proposals could set him on a collision course with Germany, whose economy is the engine of Europe and whose Chancellor, Angela Merkel, led the push for the tough fiscal agreement.

“I am ready to open this discussion … with Madame Merkel,” Hollande said.

Fears over investors ‘turning against France’

He dismissed concerns that investors would turn against France if he won the election, saying that despite his first-place showing in Sunday’s first round of voting, “I haven’t had communication of information putting our nation in danger.”

Beyond Europe’s borders, Hollande acknowledged that he doesn’t have much diplomatic experience and said he’d chart a cautious course. He said he’d stick to France’s firm policies against Syria and Iran.

He reiterated his pledge to pull all French troops out of Afghanistan by the end of this year.

“I don’t want to make a mistake. I want to make judicious decisions from the beginning,” he said.

Earlier Wednesday, Hollande pressed his leftist platform, playing to public fears about jobs and anger at bankers and ratings agencies who are widely blamed in France for the financial and economic crisis.

Vowed to resist ‘the power of money’

In his final campaign brochure, released Wednesday, he vowed to resist “the power of money” if elected and said his priorities would include “bringing finance to heel.”

Some economists say the only way for France to calm jittery investors is to pare down its debts and boost growth prospects by changing laws to make it easier to hire and fire workers and open and close companies.

Sarkozy’s finance minister shot back at Hollande’s spending plans Wednesday, warning that countries across Europe have to do more to cut costs.

French media have reported that Sarkozy’s advisers are pressing company executives to avoid announcing big layoffs during the presidential campaign, and predict a wave of job losses after the election.

Avoiding job losses

Responding to these fears, Hollande told France-2 television on Wednesday that “before any irreparable decisions are made, I should intervene.”

He said he would try to avoid a parade of layoff announcements and that company executives would have “responsibilities to take.”

He didn’t elaborate on how he would avoid job losses or name any particular companies.

Polls show that jobs are the leading concern of French voters. Both candidates have made pledges during the campaign to save jobs at a ferry operator on the English Channel and a steel plant in northern France

L’explainer: The candidates and issues in the French presidential election>

The Fiscal Compact Referendum: What are we voting on and why?

Associated Foreign Press
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