BRUSSELS (Reuters) - The European Commission has given France leeway on fiscal rules “because it is France,” the president of the EU executive Jean-Claude Juncker said on Tuesday, in a remark that may not go down well in Germany and other more thrifty euro zone states.
The European union is debating how to best apply its fiscal rules, which require a budget deficit under 3 percent of GDP and public debt to fall, at a time when some argue that more public spending would help boost economic growth.
The Commission, which is in charge of monitoring national budgets and recommending corrective measures, is sometimes accused by Germany and other northern euro zone governments of being to lenient in applying EU budget rules.
The EU executive arm gave France in 2015 two more years to bring its deficit below 3 percent of GDP, even though Paris appeared to miss agreed targets.
Asked why the Commission, on several occasions, had turned a blind eye to French infractions, Juncker admitted candidly in an interview with the French Senate television Public Senate that it did so “because it is France”.
“I know France well, its reflexes, its internal reactions, its multiple facets,” Juncker said, adding that fiscal rules should not be applied “blindly”.
He then reiterated that France should respect its current commitment to bring its deficit below 3 percent next year.
Showing a high degree of flexibility, the Commission has also granted maximum allowed leeway to Italy this year, despite Rome’s debt being above agreed limits and not decreasing as it should
Reporting by Francesco Guarascio