BRUSSELS
The European Commission has given France until 2017 to bring its budget deficit within EU rules by reducing it from the projected 4.1 percent of GDP this year to below 3 percent.
France, which is Europe’s second biggest economy after Germany, already missed a 2015 deadline.
Commission Vice President Valdis Dombrovskis told a news conference on Wednesday: "We decided to propose setting a new deadline for France to bring its deficit below 3 percent of GDP by 2017."
The European Commission demanded on Wednesday more reforms by France, which has been given more time to meet EU rules. EU wants details on the reforms in April.
France’s structural deficit must also be decreased by 0.2 percent this year with further spending cuts. The European Commission plans to make sure that the French government is in compliance with these rules.
France could face sanctions for failing to fix budget deficit.
Economic affairs commissioner Pierre Moscovici said on Wednesday: "Sanctions are always a failure. If we can convince and encourage, it is better."
"We decided to let them proceed with reforms and keep up the pressure," he said.
