France's Finance Minister Bruno Le Maire said Sunday, February 18 that the country's 2024 growth forecast had been revised down from 1.4% to 1.0% and announced spending cuts of €10 billion. The revision "takes into account the new geopolitical context", he told TF1 television, referring among other issues to the war in Ukraine. He also raised the situation in the Middle East, China's "marked economic slowdown" and "a recession in 2023 in Germany".
Weaker than expected tax receipts meant that France was going to have to make immediate savings of €10 billion in order to meet its budget targets. Le Maire's revised growth forecast aligns with other estimates. The Bank of France expects growth near 0.9%; the International Monetary Fund has forecast 1.0%; the OECD 0.6%. Five billion would have to come out of the day-to-day budgets of all the ministries, he said.
The government would cut state aid and development by nearly €1 billion and another billion euros would come out of a special budget subsidizing households switching to renewable energy sources. The finance ministry still aims to bring the public deficit to 4.4% of GDP in 2024, said Le Maire, compared to the 4.9% forecast for 2023. The government was also keeping open the option of amending the budget in the summer "depending on economic circumstances and depending on the geopolitical situation", he added.