A departure from the French government’s +1.4% growth forecast on which its 2024 operating budget was based. During the 8pm news on Sunday on TF1, Economy Minister Bruno Le Maire formalized a revision to cut his growth forecast, while with a rate of 1% in 2023, France is silencing all those who “announced a recession”.
A departure from the French government’s +1.4% growth forecast on which its 2024 operating budget was based. During the 8pm news on Sunday on TF1, Economy Minister Bruno Le Maire formalized a revision to cut his growth forecast, while with a rate of 1% in 2023, France is silencing all those who “announced a recession”.
This Sunday, February 18, the Minister of the Economy finally aligned himself with the figure put forward by the European Central Bank and the Banque de France for a week: 1%. A figure slightly higher than the growth forecast for France in 2024 by the European Commission, i.e. 0.9%.
Multiple “disappointments” for Bruno Le Maire. He cited an economic slowdown in China with global consequences, but also the powerful German neighbor, whose economic “engine” is stalling. Germany, which is coughing, is affecting a good part of European countries, in the midst of a recession from 2023, especially due to the energy crisis and its previous over-reliance on Russian gas, but also due to a sharp decline in its exports. economies and therefore France’s, whose economy also suffered from the sudden increase in lending rates. Which has the merit of curbing inflation, but inhibits a certain number of investments and slows down consumption.
This downward revision is bad news for the government as a whole, because in the context of declining growth and therefore reduced tax revenue for the state treasury, everyone will have to save to maintain the planned public deficit objective for 2024 at around 4.4%. of gross domestic product (the sum of all added value created by the French economy).
10 billion savings
Bruno Le Maire clarified that the budgetary effort will not concern social security, nor the financing of communities, “but only the state’s lifestyle”. Bersi plans to save 10 billion euros from the state’s operating budget of 491 billion euros, and all ministries, “up to their various budgets”, will have to contribute to the effort. These savings will be distributed as follows: First, five billion euros will be recovered by limiting the operating costs of the state. Clearly, savings will be made on purchases, especially energy costs.
For another 5 billion, it is the envelopes of public assistance that will be reduced. Bruno Le Maire mentioned the MaPrimeRénov’ system, whose budget was to be extended by 1.6 billion euros in 2024, and which would have to release a billion euros. Official development aid intended for developing countries will also lose a billion euros. The next 3 billion euros will be saved by state operators, such as Business France or the National Center for Space Studies.
In addition, the government does not exclude “at the beginning of the summer and taking into account the geopolitical situation and the evolution of the conflict in Ukraine”, a vote on the new draft reform budget… European elections on June 9, which could avoid the damaging electoral effects of a possible new use of article 49.3 is
“No additional taxes or duties for families”
This savings plan will be entirely based on the reduction in living standards of the ministries. Agnès Panier Runacher, representative of the Minister of Agriculture and Food Sovereignty, at the announcement of BFMTV guest Bruno Le Maire, clarified that the “economy” plan did not affect any of the intervention budgets of the ministries. The intervention budget that was heavily used, because the state signed a total check for 4 billion euros, to support the agricultural crisis (400 million euros), hospitals (500 million), revive housing (120 million) and Ukraine.
However, the economy minister assured that the budget effort will not be accompanied by tax hikes. “The French can no longer tolerate taxes. Since 2017, we have consistently refused to raise taxes, we are not changing our strategy. There will be no additional taxes or duties for families,” he promised. Asked about the project to reduce taxes for the middle classes, Bruno Le Maire also confirmed that it is ongoing.
