Jean-Claude Trichet: Interview with Ouest France
Interview with Mr Jean-Claude Trichet, President of the European Central Bank, and Ouest
France conducted by Mr Hervé Babonneau, published on 11 August 2007.
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Do the current shocks being felt by the world's stock exchanges, arising notably from
property difficulties in the US, worry you?
I said on Thursday 2 August, reporting on the meeting of the Governing Council, that we
would "continue to pay great attention to the developments in the markets over the period to
come". This is what we have been doing since then and what we are doing by granting the
markets the appropriate liquidity.
How is the euro area economy performing?
The robust growth we diagnosed several months ago has been confirmed. The International
Monetary Fund has recently revised upwards its growth expectations for the euro area this
year, i.e. for 13 countries, one of which is France, and 319 million inhabitants.
Does that translate into jobs?
There are factors you have to bear in mind. We have created in the euro area as a whole
more than 12 million jobs in the eight years since the creation of the euro in 1999. In the
eight years before that, less than three million jobs were created in the same countries. More
than 12 million jobs in eight years. That's more than the United States over the same period.
In France, it's the same thing: two million jobs after the euro, 500,000 before, in the same
preceding eight-year period.
That's also evident in the unemployment rate ...
The unemployment rate in the euro area is now at 6.9%. It's the lowest we have had for 26
years. The euro has fortunately been accompanied by the creation of more jobs than was the
case previously.
So the euro doesn't act against employment?
Those who say that the euro acts against employment don't have the figures to back up what
they are saying. I'm not saying that it is the euro by itself which has created all these jobs -
it's of course the efforts of all our fellow-citizens, the bold, creative spirit of our businesses,
the economic reforms which have been carried out, but it's also, clearly, the monetary
stability that we have brought to a whole continent, to over 300 million people. What's more,
there is a significant consensus worldwide which regards price stability as a necessary
condition for sustainable growth and sustainable job creation, because it maintains
purchasing power and boosts the confidence of savers and investors. Price stability in itself
isn't enough, but it is necessary.
Some people in France criticise you for favouring the fight against inflation, to the
detriment of growth...
Ask the French people what they think! 63 million French, along with everyone else in the
euro area - 319 million altogether - ask us to ensure price stability. It's what the opinion polls
say. Our fellow-citizens have entrusted us with this task by approving the Treaty of
Maastricht. They pay close attention to the European Central Bank ensuring price stability,
which permits the preservation of purchasing power and fosters sustainable growth and
employment. The French themselves have been historically very attached to price stability, to
monetary stability. It is true of all the great national sensitivities. It's not by chance that the
major symbolic figures of right and left - in particular, General de Gaulle and Pierre
MendèsFrance - were very attached to monetary stability.
So all is well?
Much progress has been made, but we still have a lot to do in Europe, and also in France, as
the Governor of the Banque de France said in his most recent letter. Unemployment is still
far too high, even if we have the lowest level for 26 years. It's why we are supporting the
efforts being made by all the European governments to embark on structural reforms.
Structural reforms...what does that mean?
To put this quite simply, it means making the economy more flexible and more competitive. A
flexible economy is an economy which constantly adapts, one which is capable of taking
advantage of technological progress, of the opportunities offered by the changes taking place
in the global economy. The economies which are more flexible have more growth and more
jobs for themselves and their children. In Europe today, it's the more flexible economies
which have achieved full employment.
You must be pleased to see new EU countries wanting to join the euro?
It's true, being numerous in the euro area allows us to have a large continental economy that
is stable and prosperous. Our responsibility, i.e. that of the Executive Board and the
Governing Council of the ECB, is to give the best possible monetary policy to our vast single
economy with a single currency, which is comparable with the United States. Cyprus and
Malta will join us as from 1 January 2008. The euro area will have then 320 million
inhabitants and 15 countries.