The public deficit is 6.5% of gross domestic product and debt at 112.9%, better than expected levels.
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Between the outbidding of candidates and the outbreak of inflation that brings the government to spend billions to support purchasing power, it would have been almost forgotten. And yet. The public debt reached 112.9% of the gross domestic product (GDP) in 2021, Announced INSEE, Tuesday, April 29, to 2813.1 billion euros. As a percentage of GDP, it is less than 2020 (114.6%) and below the latest forecasts of the executive (115.3%). As for the public deficit, expected “around 7%” by Bercy, it was only elevated “6.5% of GDP. And this, thanks to the marked rise in revenue (VAT and social contributions in particular) carried by the economic rebound. The tax revenues thus rebounded by 47.7 billion euros, whereas they had declined “only” of 31.4 billion in 2020.
Expenses “increase sharply” (+ 4%) Note INSEE, but still less than 2020 (+ 5.1%). On the other hand, the debt burden (interest due) swelled by $ 5 billion, as a number of state obligations are indexed to inflation. “A less important than expected deficit, a lower debt, it is the result of the effectiveness of our French protection policy that has allowed a historic rebound in growth and employment,” welcomed the Minister of the Economy, Bruno the Mayor.
Paris has now, in principle, until April 30 to send the stability program to Brussels, which specifies its medium-term budget objectives every year. But the calendar should be somewhat modified. First due on presidential polls – April 10 and 24 – Then taking into account the uncertainty about the economic benefits of the war in Ukraine.
“In 2020 [at the beginning of the first confinement], the European Commission agreed that countries send less detailed forecasts, based on different scenarios. It could be the same this time,” says Eric Woerth, President of the Committee on Finance of the National Assembly and recently rallied to the Macron candidate. “They will take into account Ukraine,” confirmed in Bercy.
If the Mayor admitted that France will have to revise its forecasts, it should not announce anything before the election. But in the majority, the cause seems heard: keep the 4% growth forecast this year seems illusory, and the target of 5% deficit, yet carved at the Cordeau at the end of the year by adjusting the 2021 amending budget, very unlikely.
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