Sarkozy hopes downgrades won’t hurt eurozone

“…All European institutions must, now more than ever, mobilize to save the euro”: Sarkozy

French President Nicolas Sarkozy said he hopes Standard & Poor’s slew of eurozone credit downgrades will not add to the region’s woes in an interview published yesterday.
The New York-based agency cut the credit rating of nine debt-laden European countries Friday, including stripping France of its top-notch AAA rating and slashing Spain by two notches to A from AA-minus.
“I hope the latest decisions Friday, which affect a large number of eurozone countries, will not constitute another difficulty,” Sarkozy told Spain’s conservative daily ABC.
“Now more than ever, we have to show valour and courage. This is true for the eurozone member states that have launched the necessary reforms. It is also true for all European institutions which must, now more than ever, mobilize to save the euro.”
Sarkozy gave the interview, published in Spanish, before arriving in Madrid where he is to be honoured by King Juan Carlos for his cooperation in the fight against armed Basque separatist group ETA.
He will hold talks with Spain’s new conservative prime minister, Mariano Rajoy, later in the day.
The French leader said he wanted to applaud the “extremely courageous” decisions taken by Spain to confront the crisis.
Rajoy’s government has announced 8.9 billion euros (USD 11 billion) in budget cuts, tax increases to bring in 6.28 billion euros and an anti-tax fraud battle to recoup another 8.17 billion euros to help balance the public finances.
But Sarkozy said deficit-cutting measures alone could not resolve the eurozone crisis.
“We all have to understand that to get Europe out of the crisis we must, in addition to the indispensable deficit-reduction measures that we have already taken, give priority to growth, to employment and competitivity.”
That message will resound in Spain, which posted an unemployment rate in the third quarter of 2011 of 21.5 percent – the highest in the industrialized world.
Rajoy said Saturday that Spain now had an “astronomical” figure of 5.4 million jobless.
Sarkozy is officially visiting Spain to receive the Order of the Golden Fleece, which dates back to 1429, for his help on ETA.
ETA announced on October 20 last year the end of its armed struggle after more 40 years of shootings and bombings that killed 829 people. Its operations have been hammered by Spanish police working closely with France.