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German media predicted that tensions between France and Germanywould be aggravated if the French Socialist candidate Fran oisHollande became president of France. With Hollande now in power,the relationship between France and Germany will undergo a periodof adjustment, which will have an impact on Europe's future. The end of "Merkozy" Shortly after the European Economic Community was established, thethen French President Charles de Gaulle and German Chancellor Dr.Konrad Adenauer signed the Treaty of Franco-German co-operation onJanuary 22, 1963. The Treaty has played an important role inpromoting European Integration. The Franco-German axis has been the main engine powering Europeandevelopment. In recent years, this axis has played an importantrole in response to a number of major issues, including theinternational financial crisis, the European sovereign debt crisisand problems currently engulfing the euro. The strength of thepartnership, along with its influence, has resulting in theEuropean press dubbing Chancellor Merkel and former PresidentSarkozy "Merkozy". President Hollande has his own unique view of the specialrelationship between France and Germany. He has reasserted theFranco-German axis view, but has stressed that the relationshipshould not be so exclusive as to ignore all others. From this wecan see that, France in future, will not only seek to strengthencooperation with Germany, but also look to respect the views ofother EU member states. Such a scenario will undoubtedly work todispel the concerns of smaller member states that are afraid ofbeing marginalized in the EU decision-making process. However, itremains to be seen whether the Franco-German axis can continue tofunction properly and serve as the engine which drives Europeforward. Reduce the deficit first, or stimulate growth? Though it hasn't been long since Hollande was elected, he andMerkel are already divided, especially on the issue of how to viewthe "financial contract." Merkel and Sarkozy were the main promoters of the "financialcontract." After repeated consultations, the proposal was acceptedby the vast majority of EU countries in January, and was signed by25 EU member countries in March. The European Economic and Monetary Union, stability, coordinationand governance of the Convention, also known as the "financialcontract," aims at strengthening the fiscal discipline of Europeanmember states. To this end, Sarkozy decided to strictly implementthe contract by reducing the 2011 budget deficit of 5.2 percent ofFrench GDP to 4.5 percent of GDP this year, and to 3 percent orless in 2013. Hollande, though, does not hold with Sarkozy's view. He believesthat the purpose of reducing the deficit is to promote growthrather than to solely reduce the deficit. Therefore, he advocatesslowing down the pace of deficit reduction so that the governmentcan stimulate economic growth through increased investment. Heviews economic growth as the solution for both the debt crisis andsocial problems. Hollande told a German newspaper on April 18 that he would blockthe EU's pact for greater fiscal rigor if it failed to includemeasures for growth. He also blocked Sarkozy's attempt to enshrinea golden rule in the constitution and asked the EU to renegotiatethe financial contract. Merkel has flatly rejected Hollande's proposal. If they cannotagree on a way forward, the EU will face a deadlock. The disputes over the "financial contract" reflect differencesbetween the two countries on how to solve the economic crisisengulfing the eurozone. Discussing his plans, Hollande said: "Ihope to improve the scale of the European Investment Bank (EIB)funds to finance major infrastructure projects within Europe, andthrough the issuance of 'project bonds' to finance the project."Hollande also hopes that the European Central Bank will loandirectly to governments in order to fund government stimulus plans,a scheme which is in violation of EU law. Hollande's idea is quite distinct from Merkel's. Merkel'sgovernment has consistently adhered to the idea of the EuropeanCentral Bank's independence. Germany insists on seeking long-termeconomic growth through structural adjustment and reform.Obviously, the common goal is to overcome the debt crisis andstabilize the euro. However, differences exist in how theseobjectives should be reached. Put simply, the question is: Is thepriority deficit reduction, or the stimulation of growth? Hollande, though, is not the sole voice of dissatisfaction withGermany's hard-line stance. There have also been murmurs ofdiscontent from other EU countries. These countries resent havingto reduce their budget deficits in such a short period of time, andwould prefer to receive an economic stimulus instead. It seems thatother countries may now follow Hollande's, and France's, lead. To this end, all sides are paying close attention to Hollande'sfirst visit to Berlin. Whether he and Merkel can reach an agreementis not only vital to Franco-German relations; it is also crucial tothe future of the EU. The author is a researcher and senior editor at the InternationalAffairs Research Center of Xinhua News Agency. (This article was written in Chinese and translated by Li Huiru.) Opinion articles reflect the views of their authors, notnecessarily those of China.org.cn. The e-commerce company in China offers quality products such as Fractional Co2 Laser Machine , Erbium Yag Laser Manufacturer, and more. For more , please visit Ultrasonic Cavitation Slimming Machine today!
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