French budget targets deficit but growth uncertain
The French government on Wednesday presented a tough 2012 austerity budget, promising to balance strained public finances but warning that eurozone debt "turbulence" could yet derail timid growth.
France's public deficit will reach 5.7 percent of gross domestic product this year, before dropping to 4.5 percent in 2012 and then to the European Union limit of 3.0 percent in 2013 and 2.0 percent in 2014.
For the first time, the government also undertook to bring the deficit down to 1.0 percent in 2015 as it seeks to put the public finances in order with barely seven months to go before a presidential election.
However, France's total, accumulated debt will be higher than previously expected, largely because of its contribution to rescue funds for bailed-out eurozone countries such as Greece, Portugal and Ireland.
Already expected to reach a record 85.5 percent of GDP this year, accumulated debt will hit 87.4 percent in 2012, half a percentage point higher than the previous estimate.
Comments