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France seeks extra year for 3 percent/GDP deficit target
February 22, 2013 / 1:49 PM / 5 years ago

France seeks extra year for 3 percent/GDP deficit target

PARIS (Reuters) - France will ask its EU partners and the European Commission for an extra year to cut its public deficit below a targeted 3 percent of GDP and will outline new savings measures soon, Finance Minister Pierre Moscovici said on Friday.

France's Finance Minister Pierre Moscovici (L) and Britain's Chancellor of the Exchequer George Osborne (2nd L) walk past a wedding car at the Ritz Carlton hotel in Moscow February 15, 2013. REUTERS/Sergei Karpukhin

Moscovici, reacting to economic forecasts from the Commission that put France’s public deficit at 3.7 percent of gross domestic product for 2013, said the government still maintained its longer term goal of a zero deficit in 2017.

France is one of several euro zone countries likely to miss their deficit targets because of economic weakness and hoping to be granted leeway providing they reduce underlying shortfalls in their finances and pledge further fiscal efforts.

“What is being envisaged is a delay. (The target) is not being pushed back indefinitely. This does not count as abandoning the targets because the (economic) situation justifies it,” Moscovici told a news conference.

“To reach the goal of 3 percent in 2014 we have already decided on a number of savings measures,” he said, adding that details would be given in the weeks ahead. “There is no question of slackening our effort with the structural gap in 2013,” he said of the part of the deficit not dependent on swings in the economic cycle.

The Socialist government says it does not want to impose too much austerity on an economy teetering near recession, and for now Moscovici said it was sticking to a plan to make savings of 60 billion euros (51.93 billion pounds) over five years.

The Commission estimated that France cut its structural deficit by 1.2 percentage points in 2012 to 3.3 percent and will cut it further this year to 2.0 percent.

Reporting by Leigh Thomas; Writing by Catherine Bremer; editing by Mark John

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