Introducing a eurozone budget is non-negotiable, French Finance Minister Bruno Le Maire said Tuesday.
In an interview with the Financial Times, he directly addressed the resistance coming from 12 countries which oppose a Franco-German budget plan, saying they are unnecessary and encourage moral hazard.
But Le Maire insisted that “the status quo is impossible.”
“A common budget is something that is not negotiable for France,” he said. “There is a need for something to stabilize against an economic shock … to defend the status quo is to feed populism.”
Le Maire made Paris position clear on Tuesday ahead of the summit meeting of eurozone leaders in Brussels on Friday.
The leaders are expected to agree on a road map to reform the eurozones economic and monetary governance, by deepening integration and boosting economic safeguards of the single currency bloc to better prepare for future crises.
France and Germany want that agreement to include a eurozone budget that would allow countries to handle economic shocks more easily, without risking public investment. But a large contingent of mostly northern European countries isnt convinced.
Le Maire went on to criticize the resisting 12-country bloc, which includes the likes of the Netherlands, Luxembourg and Ireland.
Its “not a united group,” the French minister said.
“Some like Ireland and Luxembourg have expressed an interest in a budget and have reservations regarding fiscal convergence,” he noted. “That is very different from the Netherlands, which is opposed to a budget.”