The French plan for a Eurozone budget has been demoted to a €22 billion seven-year fund, which is not likely to have systemic significance.

President Emmanuel Macron campaigned on a promise of political consolidation in the Eurozone, including a plan that went hand in hand with the creation of a Eurozone Parliament, a joint Ministry of Finance, aligned corporate tax legislation, and a Eurozone budget. The plan was initially rejected and eventually downsized due to Dutch and German resistance.

Under the French plan, the Eurozone would use the budget as a countercyclical instrument during recession. But the plan under consideration offers “incentives” for countries that implement reforms. Eurozone members should be able to sign off on the plan by June, the Financial Times report.