French state budget deficit increase to 6.1% of GDP
By Alimat Aliyeva
The French state budget deficit is expected to increase to 6.1% of GDP in 2024, which is significantly higher than the government and Fitch's spring forecasts of 5.1% of GDP, Azernews reports.
"We predict that France's deficit in 2024 will be the second largest in the eurozone and will be almost three times higher than the projected average deficit of the AA countries," the report says.
Experts have raised the estimate of the country's budget deficit in 2025 and 2026 to 5.4% of GDP. At the same time, they do not expect the government to be able to reduce the deficit below 3% of GDP by 2029.
The agency's analysts believe that the deficit will lead to a
sharp increase in the national debt - up to 118.5% of GDP by
2028.
By the end of 2026, the size of the national debt is projected at
116.3% of GDP. This is the second highest indicator among the
AA-rated States and is more than twice the average for this
category.
It should be noted that earlier Fitch changed the forecast of the long-term issuer default ratings in foreign and national currencies of France to "negative" from "stable". At the same time, the ratings are confirmed at the "AA-" level. Short-term ratings remained at "F1+".
"Fiscal policy risks have increased since our last review," Fitch noted.
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