French deficit meets EU rule for first time since 2008

By Hajer M'tiri

PARIS

France's budget deficit has met the European Union's rule of keeping the deficits below 3 percent of GDP for the first time since the financial crisis of 2008, the country’s national statistics agency said on Monday.

France's public deficit reduced to a better-than-expected 2.6 percent of GDP in 2017, better than the government's 2.9 percent target and down from 3.4 percent in 2016.

The French tax burden rose to a record of 45.4 percent of GDP product in 2017 from 44.6 percent the year before, according to a statement issued by National Institute of Statistics and Economic Studies (INSEE).

Government spending rose by 2.5 percent and government revenue by 4 percent, INSEE said.

The statistics agency also reported 2.0 percent growth in 2017, France's highest in six years.

Speaking on France Info radio, Finance Minister Bruno Le Maire welcomed the "good news" and said "it is proof that the strategy laid out by the president of the Republic on reducing public spending, realigning our public accounts and growth is the right one."

"We have honoured our engagements," Le Maire said.

A deficit under three percent of GDP for another year would allow France to exit the EU's "excessive deficit procedure".