French Deficit Set to Rise for First Time in Five Years

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http://www.businessweek.com/news/2014-09-10/french-deficit-will-rise-for-first-time-in-5-years-sapin-says



French Deficit Set to Rise for First Time in Five Years
By Mark Deen September 10, 2014

France slashed its growth forecasts and said the budget deficit will widen for the first time in five years in what Finance Minister Michel Sapin characterized as “telling the truth” on the economy.

The deficit will be equivalent to 4.4 percent of gross domestic product, up from 4.3 percent in 2013. The government cut its growth forecast to 0.4 percent from 1 percent for this year and to 1 percent from 1.7 percent for 2015.

Sapin’s confessional tone belies the tension between France and its European partners about its inability to meet fiscal rules that it helped write. The European Commission has already allowed France to delay deficit targets twice in the wake of the region’s sovereign debt crisis.

“We’re not asking for a change in European rules; we’re not asking for their suspension or for any exception for France or any other country,” Sapin told journalists in Paris. “We’re asking for a collective consideration of economic reality” and a “coherent economic strategy at the European level.”

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