PARIS (MNI) – France is counting on the UK to join in the
Eurogroup’s efforts to reinforce the firewalls around the debt crisis by
bolstering the IMF’s fund for countries with financial difficulties,
Budget Minister Valerie Pecresse said Tuesday.

“Just as a number of large G-20 countries will also contribute, I
have no doubt that the British will come to the support of the IMF,” the
minister said in a radio interview, noting that French Prime Minister
Francois Fillon had spoken by telephone with UK Deputy Prime Minister
Nick Clegg.

“I think the misunderstanding with the British has been resolved,”
Pecresse said. “What the British don’t want is bailouts specifically for
the Eurozone, of which they are not a member. But I think that if it’s a
matter of reenforcing the IMF…they will accept.”

The Eurogroup hopes that countries outside EMU will contribute E50
billion, including E30 billion from the UK, on top of the E150 billion
its own members have pledged, the minister said, adding that some
countries had expressed interest in the idea at the EU leaders’ summit
earlier this month.

Pecresse tried to reassure investors who have grown increasingly
sceptical about the quality of the country’s debt, noting the success of
Monday’s auction of more than E6 billion of short-term BTF bills.
“France can repay its debt!” she said.

The minister’s comments were echoed by a top advisor to French
President Nicolas Sarkozy, who said “there is no risk France will
default on its debt.”

A downgrade of France’s triple-A credit rating “would be totally
unjustified,” Henri Guaino said in an interview with the business daily
Les Echos published Tuesday.

“Of course there is the risk of the euro and the country is highly
indebted, but the French are among the households who save most in the
world,” Guaino reminded.

“The only risk is to become the target of speculation,” he said.
“Doubt nourishes doubt and causes [borrowing] rates to rise. This is how
a country perfectly able to pay its debts can be strangled financially.”

–Paris newsroom +331 4271 5540; email: ssandelius@marketnews.com

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