France will give general support to an expected effort by the Reagan administration at the seven-nation industrial summit in Bonn next month to promote stronger growth by European economies, but will not agree to reflate its own economy significantly this year.
While suggesting that France will join the United States in urging West Germany to accelerate a planned tax cut that would presumably stimulate consumption and imports from Bonn's trading partners, Finance Minister Pierre Beregovoy said that France's Socialist government will continue the austerity program that has cut inflation in half in three years in France and helped erase a crushing trade deficit.
"France cannot take the risk of losing what it has worked so hard to gain by reflating through increased consumption or by increasing its budget deficit," Beregovoy said yesterday in an interview at the International Monetary Fund, where he is attending the spring meeting of the fund's Interim Committee. Instead, France will settle for more moderate growth stimulated through a small dip in domestic interest rates.
In the interview and at an earlier breakfast meeting with reporters, Beregovoy implicitly suggested that France approaches the May 2 summit in Bonn with little hope that anything significant will emerge on economic policies.
He was careful to voice qualified praise for a proposal by Treasury Secretary James A. Baker III last week in Paris for an international conference to discuss stabilizing monetary exchange rates, an idea that France has advocated for three years. But Beregovoy left the impression that France viewed Baker's proposal as a tactical concession ultimately intended to limit any monetary changes to minor ones.
Beregovoy, who is a longtime political associate of President Francois Mitterrand, also is known to be much more skeptical about the chances for fundamental monetary reform and a return to more fixed exchange rates than was his predecessor, Jacques Delors, now president of the European Common Market.
The monetary conference as well as a U.S. proposal for a new round of global trade negotiations unveiled in Paris last week would be discussed at the Bonn summit, Beregovoy said. But he emphasized that no final decisions would be reached on either topic there, and he added that France would not speed up consideration of the trade negotiations in return for apparent U.S. flexibility on the monetary conference.
"It is better to prepare for a year, or for two years, for the trade negotiations and have them succeed, than to rush to start them now and have them fail," Beregovoy said, noting that France would insist that developing countries be thoroughly consulted before decisions were made on the timing and form of the negotiations.
He confirmed that France is particularly concerned about the role that technology exports would occupy in the new set of negotiations. "We are in agreement on merchandise being part of the new negotiations. We can make some progress on services as well. But when you come to technology -- well, it becomes quite difficult."
While Beregovoy would not comment on it, France has given the appearance of being concerned that the United States may try to use the new negotiating round to entrench its strong lead in technology and leave Europe in a position of long-term inferiority.
The French finance minister did voice sharp disagreement with the Reagan administration on some of the topics under discussion by the Interim Committee, including Washington's continuing opposition to increasing the resources of the World Bank and the increased role France would like to see for Special Drawing Rights in the international financial system.
Asked about proposals by U.S. officials that Europe adopt more stimulative policies to take up the slack of a flagging American economy, Beregovoy acknowledged that "it is essential for Europe to take its share of the responsibility in accelerating global recovery. But France cannot undertake an isolated reflation. We must maintain a noninflationary growth."
Beregovoy said that he expected France to achieve 2 percent growth this year. Inflation is running at about 6.4 percent, or one point above the West European average. He asserted that a gradual loosening of financial controls in France would encourage the modest growth sought this year, and he voiced hope that he would be able to lower interest rates by a percentage point in the second half of 1985, in effect injecting the equivalent of $1.5 billion into the economy for growth.