France to meet 2010 deficit target: minister

11th January 2011, Comments 0 comments

France will meet its 2010 budget deficit cutting target, even if growth is slower than expected, the budget minister said on Tuesday.

Budget Minister Francois Baroin said the government would meet the 2010 budget deficit target of 7.7 percent of gross domestic product.

"We will stick with the 7.7 percent and that is important because, let me remind you, at the beginning of 2010 we fixed the target at 8.5 percent," Baroin said.

Meeting the target has become ever more important given growing strains in the eurozone. Some members have been unable to control their debt and deficits, and Greece and Ireland have been rescued.

In recent weeks, the spotlight has fallen on Portugal as the next likely candidate for a bailout, with Spain also mentioned.

France, with a deficit among the biggest and far above the 3.0-percent EU limit, nonetheless has managed to retain the confidence of financial markets so far, with slow growth picking up modestly through 2010.

Earlier on Tuesday, the Bank of France forecast that the economy would expand by 0.6 percent in the fourth quarter of 2010, short of the 0.7-percent rate needed to meet the annual growth target of 1.6 percent.

Robust growth is crucial to meeting debt and budget reduction goals.

Baroin said that the government "faces three years of budget crisis to get through, and so we have three years of economies, tightening (ahead)."

© 2011 AFP

0 Comments To This Article