France deficit eases in 2010

, Comments 0 comments

France unexpectedly reined in its swollen public deficit in 2010 to seven percent of output while its debt hit a record 81.7 percent, official statistics showed on Thursday.

"It is a really remarkable result," Economy Minister Christine Lagarde said on the radio.

The figures published by the national statistics agency INSEE showed the 2010 deficit was 7.0 percent, down from 7.5 percent in 2009 and lower than a forecast of 7.7 percent.

Meanwhile public debt rose in 2010 to 1.591 billion euros ($2.255 billion) or 81.7 percent of gross domestic product, from 78.3 percent in 2009. The government had forecast debt of 82.9 percent for 2010.

France has for years run a high deficit and debt and these soared as the government spent billions on stimulus measures to ensure recovery from a recession brought on by the 2008 financial crisis.

INSEE said that public spending eased last year with the winding down of the stimulus measures and revenues picked up.

The latest figures are far above the limits set by EU treaties of a three-percent deficit and 60 percent debt, but France hopes the better-than-expected deficit figure will help it get under the limit in 2013.

The government this month unveiled plans for a constitutional amendment that would oblige France to work towards balancing the state and other public budgets.

© 2011 AFP

0 Comments To This Article