In addition, they agreed to cooperate closely on exchange markets. The Ministers and Governors stressed the need for consistent and mutual supportive policies and believe that the measures being taken will accelerate progress towards the increased, more balanced, economic growth, and sustainable external positions necessary for greater exchange rate stability. The Government of Canada's fiscal strategy has succeeded in achieving a drop in the rate of growth of its spending and substantial, ongoing declines in the budget deficit. Fiscal restraint has been accompanied by impressive growth of domestic demand, output and employment. Major structural initiatives directed at enhancing competitiveness and the underlying potential of the economy have been undertaken, particularly tax reform and the negotiation of a free trade agreement with the United States.
Monetary policy remains geared to non-inflationary growth in a climate of orderly exchange markets.
The Government of France has fully met its commitment to reduce its fiscal deficit and tax burden. The fiscal deficit will be reduced by 0.8 per cent of GNP from 1986 to 1988. The privatization program decided upon in early 1987 is being carried out, and its initial objectives have even been surpassed. The full implementation of the program will be resumed as soon as market conditions permit. The French Government will continue to pursue its adjustment and liberalization policies.