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         Bundesbank Chief Says France Must Take Deficit Cuts Seriously

   by Reuters

   France has a special responsibility as a euro zone heavyweight to take
   deficit reduction rules seriously, even though its budget deficit is
   above target, Bundesbank President Jens Weidmann said in an interview
   published on Sunday.
   Weidmann told the Bild am Sonntag newspaper that the credibility of the
   new euro zone rules would be hurt if their flexibility were pushed to
   the limit right at the start.
   "The economic developments in some countries have indeed been weaker
   than expected and the European rules offer in such cases a certain
   amount of flexibility," Weidmann said when asked about Italy, France
   and Slovenia getting more time to fulfill the stability criteria.
   "France, but also Germany, have a special responsibility, as
   heavyweights in the euro zone, to take seriously the new deficit
   reduction rules created last year to reduce budget deficits," he said.
   Weidmann noted that France's budget deficit was still "far above 3
   percent."
   "The credibility of the new rules certainly won't be enhanced if one
   were to exhaust and use up to a maximum the flexibility right at the
   start," Weidmann told the newspaper.
   "We definitely cannot allow the expectation to rise that at the end of
   the day the monetary policy will be able to resolve the problems," he
   said.
   The European Commission decided last week to give France two more years
   to slash its deficit to below 3 percent of gross domestic product
   because of the country's poor economic outlook within the recession-hit
   euro zone.
   German Finance Minister Wolfgang Schaeuble praised France's reform
   efforts and said the decision to give France an additional two years to
   cut its deficit was "acceptable," German regional newspaper Rheinische
   Post said.
   "If a worsened situation means it is appropriate to extend the deadline
   to cut deficit to a maximum of 3 percent, that is acceptable,"
   Schaeuble said, according to the paper.
   Schaeuble said the French government knew what it had to do and added
   that France was "on the right track."
   "On some points it will perhaps take longer than elsewhere," he said,
   adding it should not, however, be forgotten that France's economic
   structure was different from those of other countries, like Germany.
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References

   1. http://www.voanews.com/content/bundesbank-chief-says-france-must-take-deficit-cuts-seriously/1664552.html