France aims for full employment by 2012

4th July 2007, Comments 0 comments

PARIS, July 4, 2007 (AFP) - New French Prime Minister Francois Fillon reiterated Tuesday a target of "full employment" by 2012 along with a two-year delay in meeting an EU limit on France's excessive public debt.

PARIS, July 4, 2007 (AFP) - New French Prime Minister Francois Fillon reiterated Tuesday a target of "full employment" by 2012 along with a two-year delay in meeting an EU limit on France's excessive public debt.

Fillon, while unveiling the new government's programme, said it aimed at an unemployment rate of five percent of the workforce by 2012 against 8.1 percent at the moment.

"It is not impossible, even in Europe, because a good half of the European Union members already have full employment, in some cases for the past decade," he told deputies.

"Mass unemployment is therefore no more of a fatality today than inflation was yesterday," he said.

President Nicolas Sarzozy, who sets the pace of economic policy in the country, made achieving full employment one of his campaign pledges.

The employment ministry announced last week that the number of people out of work in France had dropped by 1.2 percent or 24,100 people to 1.987 million in May, which the government hailed as the lowest level "in more than 25 years."

The unemployment rate, calculated according to International Labour Organisation standards, fell by 0.1 percentage points to 8.1 percent of the active population -- high compared with European peers.

Fillon also said the government would push back to "2012 at the latest" a deadline for bringing public debt below the limit of 60 percent of output set by the European Union.

Sarkozy had already set the 2012 target as well, while the previous government of which he was a member had pledged to do it by 2010.

French public debt rose to around 65.0 percent of gross domestic product (GDP) at the end of the first quarter, from 63.7 percent at the end of 2006, reducing the government's room for manoeuvre.

The public debt represents the total of past annual public deficits.

France's debt ratio has risen in recent years in breach of eurozone rules that debt must be no greater than 60.0 percent of output or be falling consistently and structurally towards this ceiling.

On Monday, the EU presidency currently held by Portugal warned France against relaxing its fiscal policies.

Portuguese Prime Minister Jose Socrates told a press conference in Porto: "We need a very stringent budget policy and that applies everywhere whether in Portugal or France or the other countries."

On Tuesday, officials at Fillon's office said the government expected a public deficit -- a measure of state overspending -- of 2.5 percent of GDP in 2007 and 2008, higher than the 1.8 percent forecast by the previous government.

France reduced its public deficit to within the 3.0 percent limit set by EU and eurozone rules in 2005, after being in breach of the deficit rule since 2002.

Members of the European Union, and particularly those of the eurozone, are supposed to work towards a public surplus in times of economic growth.


Copyright AFP

Subject: French news

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