France Will Reduce Deficit To Within EU Targets in 2017

The French government has said it will reduce its budget deficit to below the EU threshold of 3% of GDP by 2017, two years later than promised.

The new forecast indicates the public deficit will fall to 4.3% next year, but to 2.8% by 2017.

It was released as Finance Minister Michel Sapin prepared to present his annual budget to cabinet.

Mr Sapin said growth would remain weak, projecting that the economy would only grow very slightly this year.

“We have taken the decision to adapt the pace of deficit reduction to the economic situation of the country,” he told a news conference.

“Our economic policy is not changing, but the deficit will be reduced more slowly than planned because of economic circumstances – very weak growth and very weak inflation.”

The French government is hoping to boost growth by cutting taxes, although this will have to be financed by further spending reductions.

France plans to cut public spending by €50bn ($63bn; £39bn) by 2017, the year in which the country’s next presidential election will be held.

The country has missed a number of budget deficit targets and has struggled with high unemployment and low growth.

via BBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.