Paris, May 23 (Reuters) - France Is on Course to Miss Its Already Upwardly Revised Deficit Targets and Needs to Make an Additional Push to Get Debt on a Downward Path, the International Monetary Fund Said on Thursday.
After an Annual Staff Visit to France, the IMF Estimated That the Public Sector Budget Deficit Would Hit 5.3% of Economic Output This Year and Decline to Only 4.5% by 2027.
That Would Be Far Higher Than the Government's Deficit Reduction Targets From April Which Foresee a Fiscal Shortfall of 5.1% This Year and Plot a Further Reduction to Less Than an EU Ceiling of 3% by 2027.
The Government Was Left With Little Choice but To Revise Higher Its Deficit Targets Last Month After 2023 Tax Revenue Came in Sharply Lower Than Expected.
The IMF Said That Without a Detailed and Credible Package of Measures to Rein in the Public Finances Debt Would Rise to 112% of Output This Year and Add About 1.5 Percentage Points per Year Over the Medium Term.
The Government Has Already Had to Come up With 20 Billion Euros in Emergency Budget Savings to Keep Its Revised Deficit Targets Within Reach.
The IMF Forecast That Growth in the Euro Zone's Second-Biggest Economy Would Pick up From 0.8% in 2024 to 1.3% Next Year as Easing Inflation Boosts Household Spending and Lower Interest Rates Supports Business Investment.
In Its Fiscal Planning, the Government Has Forecast Growth This Year at 1.0% and 1.4% in 2025.
(Reporting by Leigh Thomas; Editing by Toby Chopra)
((Leigh.thomas@Thomsonreuters.com; +33 1 4949 5143;))