French budget deficit at 67.9 bln euros in May

08:14, July 09, 2010      

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France's deficit stood at 67.9 billion euros (85.9 billion U.S. dollars) at the end of May, down from 82.1 billion euros (103.9 billion dollars) a year ago but up from April, the economy ministry said Thursday.

The deficit was posted at 56.2 billion euros (71 billion U.S. dollars) at the end of April but during May, public spending reached 157.4 billion euros (199 billion U.S. dollars), up 3.5 percent compared to 152.1 billion euros (192.5 billion U.S. dollars) last May.

Increasing government revenues in May contributed to the relatively smaller deficit, as tax revenues, company taxes in particular, buoyed public revenues by 13.1 percent to 102.4 billion euros (129.6 billion U.S. dollars).

Suspension of fiscal stimulus and recovering economic activities were the main factors boosting government revenue, the ministry said.

In order to narrow the huge budget gap, the government has announced a series of austerity measures, including simplifying administration lifestyles and pension reforms to cut spending.

Budget Minister Francois Baroin said Tuesday that the government was determined to reduce the deficit-to-GDP ratio to 8 percent this year and to 6 percent in 2011, requiring an increase of 40 billion euros (50.6 billion U.S. dollars) to the treasury by 2011.

Meanwhile, in another report on Thursday, the central bank revised down its prediction of the growth rate for the second quarter to 0.4 percent, down from the previous forecast of 0.5 percent.



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