France's 2026 Public Deficit To Be Higher Than Expected But Below 5%

Sumaira FH Published February 07, 2025 | 12:45 AM

PARIS, (UrduPoint / Pakistan Point News / WAM - 07th Feb, 2025) The French Ministry of Economy announced today that the projected public deficit for 2026, initially estimated at 4.6 percent of the country's GDP, will see a slight increase but will remain below the 5 percent threshold.

The ministry, alongside the Ministry of Finance and Public Accounts, stated that this adjustment will be factored into the preparation of the 2026 budget, which will soon be under discussion.

In October, France submitted its medium-term financial plan to the European Commission, outlining its commitment to reducing the public deficit to 2.8 percent by 2029, while maintaining the Primary goal of bringing it below 3 percent in accordance with European fiscal rules.

Meanwhile, the French Parliament today approved the 2025 state budget in a final vote in the Senate, concluding a legislative process that faced hurdles, particularly after the bill was suspended in December following a regulatory decision by the government of Michel Barnier.

The newly adopted budget includes austerity measures worth €50 billion, aimed at reducing the public deficit to 5.4 percent of GDP in 2025, down from the approximately 6 percent deficit expected for 2024.

The Ministry of Economy stressed that achieving this target is "essential", noting that budget implementation will be closely monitored to ensure compliance with ministerial allocations and to take any necessary corrective measures.

Additionally, the French government has revised its economic growth forecast for 2025, lowering it from 1.1 percent to 0.9 percent.