EU ministers wary of debt buildup on Obama debut-day - by Huw Jones and Anna Willard
EU finance ministers came under pressure on Tuesday to recommit to lower national debts and roll back public spending once the region starts to pull out of recession. The European Union is striving to mobilise 200 billion euros ($260 billion) of public cash to blunt recession, way short of the $800-billion-plus being prepared by Barack Obama, whose inauguration as U.S. president comes later in the day. As he prepared to chair talks with colleagues from the 27 EU countries in Brussels, Czech Finance Minister Miroslav Kalousek said ministers needed to demonstrate that they still had an eye on the longer-term goal of balanced state finances. "Public aid must be transparent and we must voice a pledge to go back to consolidating public deficits as soon as possible," Kalousek, whose country has just assumed the rotating EU presidency, said as he entered the so-called Ecofin talks.
Jean-Claude Juncker, who had chaired talks among euro zone finance ministers on Monday, said the buildup of more government debts was a worry for all, the United States first and foremost. "The Americans must take great care that they do not get too much in debt," Juncker said. "That is my biggest concern, along with others in Europe," he told German radio Deutschlandfunk on Tuesday, hours before Obama's inauguration ceremony. He said it was important that the United States did not sink into protectionism and it would be wrong if the U.S. government gave long-term aid to its auto industry without similar moves in Europe, where France is leading a push for aid to car makers.
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