Germany 'sure' France will stick to EU budget rules

(BERLIN) - Germany's finance minister Wednesday voiced confidence that France would stick to European Union rules on public deficits after French President Francois Hollande acknowledged that Paris would exceed EU limits.

Wolfgang Schaeuble told reporters he was "sure that France would, like us, respect the rules" that limit EU countries' public deficits to no more than three percent of gross domestic product (GDP).

On Tuesday, Hollande publicly scrapped his government's goal of cutting the deficit to the three-percent ceiling, saying that it would probably amount to 3.7 percent of GDP.

The European Commission has indicated that it may give France some slack in achieving the deficit target, and the International Monetary Fund has recently warned EU countries that cutting deficits too fast was harming growth, a position that France supports.

"We have full confidence in France and the European Commission," Schaeuble insisted.

He emphasised the importance of sticking to the rules and said there was "no doubt" that Paris, as well as Berlin, would fulfil its responsibilities in this respect.

"We don't need to give each other mutual advice in public," said Schaeuble.

The German government approved Wednesday a draft 2014 budget with the lowest deficit in 40 years, hailed by the economy minister as a "historic" step in the battle against debt.

The structural federal budget -- excluding one-off items and the effects of the economic cycle -- would be balanced in 2014, the finance ministry said.