Public deficit falls to 2.5 percent of output

15th May 2007, Comments 0 comments

PARIS, May 15, 2007 (AFP) - France reduced budget overspending to 2.5 percent of national output last year, and the debt also fell to 63.7 percent of output but still breached EU rules, official data showed on Tuesday.

PARIS, May 15, 2007 (AFP) - France reduced budget overspending to 2.5 percent of national output last year, and the debt also fell to 63.7 percent of output but still breached EU rules, official data showed on Tuesday.

The deficit and particularly high level of debt became central issues in the recent presidential election for the first time. All of the main candidates said that the debt had to be contained and reduced.

In 2005, France had cut its so-called public deficit of annual overspending to the European Union ceiling of 3.0 percent of gross domestic product.

France had been seriously in breach of the annual deficit rule. Members of the European Union, and particularly of the eurozone, are supposed to be working towards a surplus in times of growth.

The rules also set a maximum for the debt, or accumulated past deficits, of 60 percent of gross domestic product; and require members to be working continuously to reduce the debt to, and below, this figure.

The public debt, or surplus, covers the budgets of central government, social welfare programmes and local authorities.

The French data, from the national statistics institute INSEE said that the deficit last year fell by 5.3 billion euros to 45.5 billion euros (61.8 billion dollars), falling from 3.0 percent of output in 2005 to 2.5 percent in 2006.

The debt totalled 1,142 billion euros at the end of last year.

It rose in 2005 but fell by 2.5 percentage points last year to 63.7 percent of GDP.


Copyright AFP

Subject: French news

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