France reduces deficit below EU limit

By:

Vivienne Russell

29 Mar 18

France has reduced its deficit to below the 3% European Union limit for the first time in a decade, it has been announced.

Figures published by Frances’s INSEE statistics office on 26 March showed the public deficit was €59.3bn in 2017, equivalent to 2.6% of GDP.

This was eight percentage points lower than the 2016 public deficit of 3.4%.

French president Emmanuel Macron has made fiscal discipline a key part of his policy programme and is keen to respect the EU’s Stability and Growth Pact rules, which encourage sound public finances and instruct member states to run deficits of no more than 3%.

Finance minister Bruno Le Maire told French radio the figures “help us get back our credibility in Europe”, according to Reuters reports.

“When the president speaks in Europe, he is listened to and respected.”

The INSEE figures also showed that public revenues increase from 53.2% of GDP to 53.9%, while public spending fell slightly from 56.6% of GDP in 2016 to 56.5% in 2017.

However, gross government debt also increased hitting 97.0% of GDP, up from 96.6% in 2016.

Spending on social benefits was €591.3bn in 2017, a 2.1% increase on the €579.4bn spent in 2016.