Germany and the eurozone: The view from Paris

Relations between France and Germany are strained. Key German officials regard France as incapable of controlling spending or enacting serious structural reform. France is concerned about the stagnation of the eurozone (which is likely to grow at less than 1 per cent this year and to do not much better next year), the deflation afflicting parts of it (prices are falling in France) and the negative impact that these problems will have on French growth, job-creation and debt sustainability. But Germany’s austerity policies – for both the EU and Germany – make it harder for France to grow, which worsens the fiscal position and makes painful reform politically more difficult.

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