France insists debt promises will be kept

10th November 2011, Comments 0 comments

French finance ministers insisted Thursday their government would meet its deficit reduction targets after the European Commission urged Paris to step up its austerity drive.

Finance Minister Francois Baroin and Budget Minister Valerie Pecresse issued a statement protesting that they remain on course to reduce France's public deficit to three percent of GDP by 2013 and to balance the budget by 2016.

France's Prime Minister Francois Fillon announced on Monday 65 billion euros in cuts and tax rises designed to clean up France's books and preserve its precious "AAA" credit rating, amid worries about eurozone sovereign debt.

But on Thursday the European Commissioner for economic affairs, Olli Rehn, warned France that still more needed to be done for France to meet its previous promises to its eurozone partners.

Baroin and Pecresse insisted that efforts remain on course, even if French annual GDP growth drops, as feared, to less that one percent this year, and underlined what they said was "the government's total determination".

They noted that France had six billion euros on reserve in its 2012 budget to compensate for any growth shortfall, and promised to renew this measure in case output remains stagnant through 2013.

© 2011 AFP

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