PARIS (MNI) – Growth, employment and the reduction of deficits will
be the focus of the French government policy in the coming weeks, Prime
Minister Francois Fillon said Tuesday.

“The first priority is growth and employment,” Fillon told the
National Assembly, underscoring the need to bolster competitiveness.
Measures for sustainable development must be “better coordinated with
all European countries” so that France’s competitive stance is not
undermined, he said.

“Our second priority is the reduction of deficits,” he said. “It’s
an absolute priority in the context of the financial crisis in Europe.”
The government will continue to restrain spending and replace only half
of the civil servants who retire each year, he said.

France’s public deficit is expected to climb from an estimated 7.9%
of GDP last year to an expected 8.2% this year. The government’s latest
Stability Program foresees a reduction in the public deficit to 6.0% of
GDP next year, to 4.6% in 2012 and to 3.0% in 2013, assuming GDP growth
of 2.5% from 2011 onward.

Speaking to Parliament for the first time since the resounding
defeat of his party’s candidates in the regional elections on Sunday,
Fillon said that the outcome of the vote did not modify the challenges
that lie ahead, notably to restore competitiveness vis-a-vis Germany,
reduce indebtedness and preserve the social system amid an ageing
population.

“We will amplify our efforts to meet these challenges,” he pledged.

The prime minister also underlined the need for a “just and
effective” reform of the public pension system to assure its financing
over the long term.

Former budget minister Eric Woerth, who was appointed minister of
social affairs in a Cabinet reshuffle late Monday and who will
coordinate the pension negotiations with unions and employers in both
the private and public sphere, promised to consult all sides before
submitting a reform proposal next autumn.

The pension reform must assure “fairness and social justice,”
Woerth stressed. “It’s because there will be fairness that the French
people will understand this reform.”

–Paris newsroom +331 4271 5540; e-mail: stephen@marketnews.com

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