PARIS (Reuters) – French Finance Minister Bruno Le Maire on Thursday said resolving trade sanctions was his priority with the new US administration to prevent a trade war from adding to the economic pain of the pandemic of coronavirus.
The administration of US President Donald Trump has hit France with tariffs on wine after failing to resolve a 16-year dispute over aircraft subsidies with the European Union. He also threatened to impose tariffs on French cosmetics, handbags and other imports over the Paris digital service tax on large internet companies.
“The consequences of trade sanctions on our economy are very negative and very damaging. We already have the pandemic crisis, ”Le Maire said in an interview with the Reuters Next conference.
“We must not add any kind of hardship to this very difficult economic situation. A trade war is neither in the interest of the United States nor in the interest of Europe. “
The mayor said he had not received any “initial signal” from the Biden administration on how it would handle the trade, but hoped to travel to Washington in February.
If the Biden administration lends its support, Le Maire said stalled negotiations between nearly 140 countries to rewrite international tax rules could be revived at the Organization for Economic Co-operation and Development (OECD) and concluded within six months.
Trade tensions with Washington added to the clouds that hung over the French economy last year, as it was already grappling with its worst recession since World War II.
The US government this week began collecting new duties on certain non-sparkling wines as well as cognacs and other eaux-de-vie from France, adding to the pressure on the economy as it struggles with a slow start of its vaccination program.
Despite a weak start to the year, Le Maire said his 6% growth forecast in 2021 remained within reach and that he was confident of a strong recovery in the second half of the year.
“We have to remain humble and careful because we have been duped by the virus on several occasions,” he said, adding that he was not worried about the initial slow pace of the deployment of the COVID-19 vaccine in France.
Although the crisis left France with a record level of debt, equivalent to more than 120% of economic output, Le Maire said the time to reduce it would come only after the crisis.
While debt reduction would require a return to economic growth on the one hand, he said it would also need reforms like an unpopular pension overhaul that was put aside at the start of the pandemic.
While acknowledging that public spending should eventually be brought under control, he said the 2024 Olympics in France must continue.
“People also need dreams and I think the Olympic Games are a dream that can have a very positive effect on the French population,” he said.
For more information on the Reuters Next conference, please click here or at www.reuters.com/business/reuters-next
To watch Reuters Next live, visit here