France to raise 2024 deficit target to 5%-5.1% of GDP - Les Echos

For 2025, France is targeting a 4.1% deficit, revised up from an earlier target of 3.7%, Les Echos reported. Following decades of spending beyond its means, France must in coming weeks show how it will avoid a budget crunch that is putting its credit ratings at risk.

France's finance ministry will raise on Wednesday its deficit target to the equivalent of 5%-5.1% of GDP for 2024, up from an original target of 4.4% due to a rapid deterioration of state finances, financial daily Les Echos reported. It also said that French President Emmanuel Macron and French Finance Minister Bruno Le Maire are at loggerheads about the issue, with Le Maire advocating stronger budget cuts to bring state finances back on track.

The paper reports that, officially, the objective of returning to below 3% in 2027 remains in place, even if most economist consider this unlikely. For 2025, France is targeting a 4.1% deficit, revised up from an earlier target of 3.7%, Les Echos reported.

Following decades of spending beyond its means, France must in coming weeks show how it will avoid a budget crunch that is putting its credit ratings at risk. Earlier this month, the government said the deficit ended 2023 at 5.5% of GDP, overshooting the 4.9% target.

Several other EU countries, notably Italy, are also running deficit's above the 3% limit.

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