French public debt over 2.0 trillion euros for first time

AFP, Tuesday 30 Sep 2014

France's public debt topped the symbolic level of 2.0 trillion euros for the first time, according to quarterly data published by the national statistics agency INSEE on Tuesday.

The total national debt amounted to 2.023 trillion euros ($2.57 trillion) in the second quarter of the year, INSEE said, which represents 95.1 percent of gross domestic product (GDP).

European Union rules limit debt to 60 percent of GDP.

In the first quarter of the year, the debt stood at 1.995 trillion euros, or 94.0 percent of GDP, INSEE said.

France is already on a collision course with the EU over its budget deficit, which is supposed to be kept under three percent of GDP.

Paris promised to bring the deficit under three percent by next year but, in a stunning about turn, announced earlier this month that it was pushing back this target until 2017.

France is struggling with an economy at a standstill and sky-high unemployment.

There has been zero growth for the first two quarters of the year and Finance Minister Michel Sapin is banking on sluggish output of 0.4 percent for the whole of the year.

France will on Wednesday publish its annual budget expected to confirm the gloomy outlook and reaffirm it will miss its deficit targets.

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