France's state finances deteriorate as it misses target on cutting deficit

RFI

10 April 2024 at 6:29 am·1-min read

France's finance ministry will raise its deficit target for 2024 to the equivalent of between 5 percent and 5.1 of GDP on Wednesday, up from an original target of 4.4 percent due to a rapid deterioration of state finances, reported a leading French financial newspaper.

At the end of 2023, France's public deficit stood at €3 trillion, making it one of the most indebted countries in the EU

According to Les Echos daily, President Emmanuel Macron and Finance Minister Bruno Le Maire are at loggerheads over how to bring state finances back on track, with Le Maire arguing for stronger budget cuts and rejecting any increase in income tax.

The paper said the new target would require additional spending cuts worth €10 bn, on top of the €10 bn of spending cuts announced in February.

Paris is due to send a revised deficit reduction plan to Brussels in the next few days.

French budget deficit widens but government promises no tax hike

Credit ratings at risk

The paper reported that, officially, the objective of returning to below 3 percent in 2027 remains in place, even if most economists are sceptical.

(with Reuters)

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