Paris (AFP) – France said Wednesday it would again grow back to 2017 instead of 2015, its objective of reducing the public deficit below the EU limit of 3% of gross domestic product, citing ” an exceptional situation “in Europe.
The deficit, the difference between revenue and expenditure of the State, local authorities and social security will even increase as a percentage of gross domestic product (GDP ) this year, to 4.4% of GDP against 4.2% last year, a
accepted Mr. Sapin. should gradually decrease to 4.3% in 2015 and go under the threshold 3% in 2017.
France had twice requested to postpone this commitment, under the presidency of Nicolas Sarkozy then under Francois Hollande.
government initially expected a deficit reduced to 3.8% of GDP this year and next year falling to 3%.
But this scenario is disturbed by what Mr. Sapin described as “status exceptional “economy in the eurozone,” marked by a very low growth combined with a slowdown in inflation that no one had anticipated. “
A word” unprecedented in economic history the Europe, “he said.
By using the words” exceptional situation “, according to the terminology that European treaties allow derogations from budgetary targets, Mr. Sapin sent an implicit message the European Commission, the guardian of fiscal discipline.
“We are not asking for changes in EU rules, we are not asking them suspended, and no exception,” he clarified, however.
The Minister also corrected Wednesday its growth forecasts for France to 0.4% this year and 1% next year
He said also that low. inflation, weighing on public accounts by reducing revenues and neutralizing some savings efforts should continue in France, with an expected rate of 0.5% in 2014 and 0.9% in 2015.
Initially, Paris was hoping for a growth of 1% this year, accelerating to 1.7% next year, but Mr Sapin indicated in mid-August that this objective was no longer valid.
– Undertaking on money –
But despite the sluggish growth, the French economy has started timidly to create jobs in the second quarter, with 8,300 new jobs (+0.1%) in the commercial sector, Insee said Wednesday.
Minister François Rebsamen work called bosses to go “faster” in job creation under the Covenant of responsibility that provides $ 40 billion reduction labor costs and taxes over three years.
Anxious to compensate the bad effect, with its European partners, this revision of the deficit path, the Minister has given a pledge on public spending . In a complete about-face, he announced that the savings on the natural progression of public spending by 21 billion euros planned for next year would be well maintained, contrary to what he had said there was only one week.
“Spend management is a must and we will go to the end of the 50 billion in savings planned through 2017, starting with 21 billion savings for the only year 2015, “he said.
September 2, Mr. Tree had told AFP that the first $ 50 billion would not be achieved due to the decline in inflation which destroys the calculated not indexing expenses or benefits on the higher prices economies.
“We can not have the same objectives with inflation becomes very weak,” he had said in response to a question on 21000000000.
“The two billion savings will not be realized because of low inflation will therefore be compensated,” said Mr. Sapin Wednesday and announcing saving measures, which will be detailed during the presentation of the budget on October 1st.
“We do not change our path. The budget remains serious commitment that has been made since the beginning (2012, ed) “and” the budget seriously reduced government spending remains the line to be followed, “said Wednesday the spokesman Stephane government Le Foll.
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