Germany and France agreed Monday to draw up proposals by the beginning of December to boost investment as they try to come up with a strategy that will help shore up the European economic recovery.
The German government has faced pressure from abroad to pump more money into the economy to help bolster both its and Europe's recovery. However, it appears determined to stick to plans to halt new borrowing next year for the first time since 1969.
France, meanwhile, is under pressure to get its finances in order after admitting that its 2015 budget would break promises to bring its deficit below the European Union limit of 3 percent of its annual gross domestic product within two years.
'We are determined to do everything together to strengthen investment in our countries. We will do that in the framework of the different capacities we have to act,' German Finance Minister Wolfgang Schaeuble said after he, and Germany's economy minister met their French counterparts.
A plan to be drawn up over the coming weeks will likely include investment proposals for Germany and France, as well as possible joint projects and 'common ideas for European projects,' French Economy Minister Emmanuel Macron said.
The German ministers stressed the importance of stimulating private investment, rather than boosting government borrowing.
Ahead of his visit, Macron was quoted by a German newspaper as suggesting that Berlin should raise investment by 50 billion euros ($63.8 billion) over the next three years while Paris cuts spending by the same amount. Macron said Monday he 'didn't demand anything' but noted that 'Germany has a greater capacity than us to make investments.'
The European Union executive will decide over the coming weeks whether to force member countries to revise their budgets. German weekly Der Spiegel reported Monday, without citing sources, that Germany could oppose such a move against France if Paris commits to a specific timetable for reforms.
French Finance Minister Michel Sapin insisted that 'there is no pact and we are not looking for a pact' on the budget issue, and that Paris doesn't want any change to budget rules.