The European Union's executive arm has criticized France for running up excessive debt, along with six other member states. The EU Commission recommended that these nations, including France, initiate an 'excessive deficit procedure' to address their financial imbalances. The criteria for deficits and debt set by the EU have not been met by these countries, leading to this rebuke.
For years, the EU has outlined targets for member states to keep their annual deficit within 3% of Gross Domestic Product and overall debt within 60% of output. Despite past leniency, the EU Commission emphasized the need for adherence to these guidelines based on facts rather than the size of the country.
France's annual deficit stood at 5.5% last year, prompting concerns over its financial stability. The announcement comes at a crucial time as President Emmanuel Macron faces strong challenges from the extreme right and left in the upcoming elections.
While Macron's camp may use this criticism to caution against extreme economic measures, the opposition argues for increased deficit spending to boost the economy. Despite the rebuke, EU Economy Commissioner Paolo Gentiloni acknowledged France's efforts to address financial imbalances, offering reassurance to EU institutions.
The International Monetary Fund projects modest economic growth for France in the coming years, emphasizing the need for a balanced approach to fiscal policy. Gentiloni highlighted that excessive austerity is not the solution for the future, cautioning against drastic measures that could harm the economy.
As France navigates its economic challenges amidst a heated election campaign, the EU's scrutiny over excessive debt serves as a reminder of the importance of fiscal responsibility and sustainable economic policies.
