On Monday 29 April, France’s Budget Minister, Thomas Cazenave, confirmed the new budget path that the French government has set itself to bring the public deficit down to 2.9% of national GDP by 2027, the year of the next presidential elections, thus maintaining a previous commitment, despite a less favourable economic climate.
“To achieve this objective, we are readjusting our trajectory with a credible first step that takes into account the dual effect of the 2023 budget and the revised 2024 growth forecast: the objective is to reduce the deficit from 5.5% to 5.1% in 2024. The rest of the trajectory has also been modified (...): we are aiming for a deficit of 4.1% in 2025 and 3.6% in 2026”, declared Mr Cazenave during a debate in the French Parliament, a few days after two international rating agencies maintained France’s financial rating.
This revision of the budget trajectory is due in particular to a slowdown in growth, with the French authorities now forecasting wealth production of 1.0% of GDP in 2024 and 1.4% in 2025.
On the expenditure side, Mr Cazenave mentioned the €10 billion in savings (moderating the increase in certain schemes such as the private home renovation allowance, reducing State expenditure by leaving precautionary reserves untouched) committed for this year, to which a further €10 billion will be added.
“In a nutshell, we need to keep government spending under control in 2024, as we did in 2023”, said Mr Cazenave. (Original version in French by Mathieu Bion)