France sees no deal on EU spending rules without more room for green, security investment

PARIS — France’s Finance Minister Bruno Le Maire warned that Paris will oppose a reform of EU spending rules if it doesn’t give capitals more space to invest in the green transition and in defense.

"We’re not going to be told ‘look, you’ve got to get your public finances back on track for three or four years — we’ll do it — and then during those three or four years you won’t have the right to any investment in climate change, any investment in security, any investment in green industry, because your absolute priority is to get your public finances back on track,’" Le Maire told an event at the French economy ministry in Paris today. "That’s a no."

The overhaul of the rules will be discussed by EU finance ministers during a dinner in Brussels on Thursday and a scheduled meeting on Friday.

Despite weeks of negotiations, EU countries, and in particular France and Germany, still disagree on how fast governments would have to cut public debt. Last week, the Spanish presidency of the EU circulated a new draft compromise under which heavily indebted governments would have to reduce debt by at least an average of 1 percent of GDP per year.

But the proposal didn’t convince Germany, which is pushing for stricter spending rules and a faster debt reduction.

The German reticence irritated France, even if Le Maire didn’t explicitly mention Berlin.

"Austerity does not make a political project for Europe, and never will, especially at this historic moment," Le Maire said, adding that EU spending rules are "an instrument serving a policy, not an objective in itself."