Despite the difficult economic and social context, France is doing well. After Jeffrey Franks, chef de mission du IMF pour la France, I questioned by the AFP, the different government measures on permission to contain the taux d’inflation “deux à three points” in dessous du level qu’il aurait atteint sans these last.
Faced with this assessment, Bruno Le Maire welcomed the announcement of upwardly reassessed growth forecasts of 0.75% in 2023. “Despite the uncertainties that persist, we confirm positive growth for next year.” And to add: “France has the lowest inflation level in Europe thanks to the tariff shield. It is the only developed country to have exceeded its pre-crisis level of activity by the end of 2021.
The IMF calls for an end to ‘whatever the cost’
If these results are the result of decisions taken by the government to protect the country’s economy, the IMF warns and calls for an end “whatever the cost.” “France must start next year to clean up its finances.” According to AFP, since last year the country has increased spending, which represents more than 2% of its GDP.
Therefore, the international financial institution recommends starting fiscal consolidation in 2023. In Paris, however, policies are not going in that direction, underlines Jeffrey Franks. “The 2023 budget law does not have the objective of reducing the deficit, postponing the fiscal adjustment to 2024.” The Government foresees a public deficit of 5% next year after 4.9% this year and plans to return to below 3% in 2027.
target help
According to the IMF, a budget adjustment of a quarter of a point of GDP will be possible with the targeting of energy aid. He suggests postponing production tax cuts. Other avenues are also being considered, namely pension and unemployment insurance reforms, as well as closing tax loopholes. We will “implement” the first two, recalled Bruno Le Maire.
Source: BFM TV
