France’s public sector budget deficit widened more than the government had planned last year, official data showed on Tuesday, putting pressure on Paris as it struggles to maintain its deficit reduction plans.
Statistics agency INSEE said public accounts for 2023 showed a fiscal deficit of 5.5 percent of economic output last year, up from 4.8 percent in 2022 and well above the government’s target of 4.9 percent.
Although the government has warned in advance that the deficit will be worse than expected, this is still bad news because it means that additional savings need to be found in the budget this year in order to meet the 2024 deficit target of 4.1 percent.
The government has already earmarked 10 billion euros ($10.9 billion) for additional budget cuts this year and said it may have to pass legislation in the middle of the year to make additional savings.
Finance Minister Bruno Le Maire has been keen to show in recent weeks that France remains committed to reducing the deficit to less than the EU’s three percent limit by 2027, with rating agencies due to update their ratings in April and May.
INSEE also said that French public debt stood at 110.6 percent of GDP at the end of the fourth quarter of 2023, up from 111.9 percent at the end of the fourth quarter of 2022, Fena news agency writes.
