France's Emmanuel Macron Takes EU Renewal Push to Greece

By William Horobin in Paris and Nektaria Stamouli in Athens Features Dow Jones Newswires

The European Union will crumble if it isn't overhauled, French President Emmanuel Macron said Thursday in Athens, attempting to reinvigorate his call for greater sharing of financial burdens in the eurozone.

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The French leader's trip to Greece is part of a tour of European capitals to marshal support for the changes the 39-year-old says are needed to shelter the eurozone and Europe from further economic or debt crises.

Mr. Macron said he would propose to fellow European leaders a road map in coming weeks for greater economic and social convergence in Europe. For the eurozone, he says it should have new structures to create its own a budget, parliament and executive.

"In Europe, today, sovereignty, democracy and trust are in danger," Mr. Macron said.

Mr. Macron spoke at Pnyx hill, the meeting point of ancient Athenian assembly, a location deliberately chosen to symbolize what his aides describe as France's push for democratic renewal in Europe.

The French President has to strike a careful balance, pushing Germany to bend, while keeping its powerful leader, Chancellor Angela Merkel, willing to work closely with him.

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To coax Germany, Mr. Macron has proposed a "new deal" for the eurozone, according to which France and other deficit countries will repair their finances and overhaul their economies, as European peers have long advocated. To that end, Mr. Macron has vowed to impose spending cuts to bring France's budget within EU rules and is pushing through a contentious overhaul of France's labor code.

"Our eurozone needs to stop a kind of internal civil war where we look at little differences," Mr. Macron said earlier Thursday after a meeting with Greek President Prokopis Pavlopoulos.

Ms. Merkel has indicated some willingness to consider Mr. Macron's ideas. But the German leader, who faces elections in less than three weeks, has only suggested a small budget that would extend aid with conditions to countries attempting to overhaul their economies. Mr. Macron, meanwhile, is pushing for a eurozone budget equivalent in size to "several" percentage points of economic output that could invest across the bloc.

"We need the maximum level of ambition," Mr. Macron said after the meeting with Mr. Pavlopoulos.

Mr. Macron said he would rally support behind his road map for change in Europe by holding "democratic conventions" in every country to discuss the changes. The conventions would take place in the first six months of 2018 with the aim of surfacing criticisms to find a consensus, Mr. Macron said.

The plan is risky, analysts say, because it could bring to light euroskepticism and divisions between countries.

"Not every country is ready to have a grass-roots democratic convention. It could trigger a backlash," said Guntram Wolff, director of the Bruegel think tank in Brussels.

Some of Mr. Macron's other ideas have run into hurdles. On the Eastern European leg of his European tour, he clashed with the Polish government over his attempts to put further restrictions on cheap labor from the east undercutting workers in France.

In Athens, the French leader received a warmer reception, as Greek Prime Minister Alexis Tsipras sees close ties with France and Mr. Macron as a counterbalance to Germany in the eurozone.

Mr. Macron traveled to Athens with about 40 business leaders from Paris, officials say, in an effort to show the eurozone is ready to turn the corner on years of debt and economic crises and Greece is open for business as part of an integrated European economy.

Mr. Macron, as France's economic minister, pushed behind the scenes to keep Greece in the eurozone when the country was teetering on the edge of economic collapse in 2015. Since taking office, his government has lobbied for debt-relief measures in exchange for the Greek government's efforts to cut spending and overhaul its economy.

"France is fulfilling its historical role in the EU with its support to Greece," Mr. Pavlopoulos said.

--Andrea Thomas in Berlin contributed to this article.

Write to William Horobin at William.Horobin@wsj.com and Nektaria Stamouli at nektaria.stamouli@wsj.com

(END) Dow Jones Newswires

September 07, 2017 15:58 ET (19:58 GMT)