France Budget Deficit
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France budget is largely based on growth forecast of the gross domestic product or the GDP. The forecast for the year 2007 has been framed between 2 percent to 2.5 percent. Lately, the French government has been urged to cut down France budget deficit. It is reckoned that France budget deficit will become 2.3 percent of the gross domestic product in the year 2008. The government intends to achieve this by cutting down taxes.
The target set by the French government pertaining to public deficit has been fixed at 2.4 percent for the year 2007. The public deficit was 2.5 percent more in the year 2006. With 2.4 percent, France has managed to keep the deficit much below the percentage fixed as per the Maastricht norms. Studies reveal that France budget deficit, which is 41.7 billion euro, is lower than 42 billion euro.
Essential features of France budget deficit:
- It is reckoned that France budget deficit will go down to 41.6 billion euro equivalent to USD$52.8 billion.
- It is expected that the budget gap will decline in the year 2007 and is reckoned to be 2.5% of the gross domestic product. If complied with, this will be the lowest figure attained since the year 2001.
- The budget proposed by the French government has been regarded as a “good budget”. The budget of 2007 is regarded as employment friendly. In addition to this, it is reckoned to be compatible with the purchasing power of euro and also plays a vital role pertaining to reduction in debts.
Ways to handle France budget deficit:
In order to compensate for France budget deficit, the French government is taking steps to downsize its working force by approximately, 15,019 workers. It was found out that in the month of August, consumer spending in case of manufactured commodities escalated 3.3 percent since July, 2007. This was the highest that was recorded in the last seven years.
Future trends:
Some economists assume that public deficit would become worst in the year 2008. It is estimated that it would be 2.5 percent to 3 percent of the gross domestic product or the GDP. With regard to public debt, it is anticipated that it will become more stable and would be recorded at approximately 64.2 percent of the gross domestic product or the GDP.
