Media: France faces record budget deficit

French Minister of Economy, Finance and Industry Antoine Armand has said that France is currently facing the biggest budget deficit in its history.

“Aside from a couple of exceptional crisis years, we are experiencing the most severe deficit we’ve ever seen. The situation is very serious,” he said, Caliber.Az reports via foreign radio station. 

However, Arman emphasised that France's GDP growth is outpacing that of Germany, which has long served as a benchmark for Paris. By the end of 2023, the French state budget deficit reached 173 billion euros.

Antoine Armand, a 33-year-old ally of President Emmanuel Macron, was appointed France's new finance minister over the weekend. He acknowledged concerns about his youth and limited experience as he takes on the challenging task of guiding the country out of a significant fiscal crisis amidst growing investor anxiety over debt. Currently, France's 10-year bond yield is perilously close to exceeding that of Spain's, a situation not seen since late 2007. 

"I understand these concerns," Armand stated, recognizing the difference in habits that come with government experience.

Alongside new Budget Minister Laurent Saint Martin, 39, Armand faces the formidable challenge of addressing a budget deficit that could reach 6 percent of GDP. 

"We have one of the worst deficits in our history, so the situation is serious," he remarked, emphasising their commitment to tackling the issue.

When questioned about meeting the budget deficit projection for this year, Armand refrained from providing a definitive answer, stating that he is collaborating with the budget minister on a "credible" updated estimate. 

Last week, France's chief auditor informed lawmakers that the finance ministry's current deficit forecast of 5.1 per cent of GDP is likely unattainable due to falling tax revenues amid an economic slowdown and insufficient public sector savings.

By Naila Huseynova