France announces €10 billion budget cuts as growth slows

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France announces €10 billion budget cuts as growth slows
French Prime Minister Gabriel Attal (L) chats with France's Minister for Economy Bruno Le Maire in Paris, on February 21, 2024 (Photo by ALAIN JOCARD / POOL / AFP)

The French government on Thursday unveiled budget cuts of €10 billion as it seeks to rein in its budget deficit after growth failed to meet expectations.


The cuts controversially include €2 billion that were to be spent on environmental and energy transition programs.

Other cuts are being made to previously budgeted spending on education, justice, defence and regional development.

Among them are changes to the CPF scheme that offers a €500 a year budget for classes and professional training for anyone who is an employee in France.

Mon CPF: What changes with France's €500 training budget?

The government had announced on February 18th it was planning the cuts, and the decree enacting them was published on Thursday in France's Journal Officiel and signed by Prime Minister Gabriel Attal, who was recently named by centrist President Emmanuel Macron in a cabinet reshuffle.

The government had warned of the cuts Sunday to hold its 2024 deficit to 4.4 percent of GDP, after revising downward its growth forecast to one percent amid international tensions and slowing economies in major trading partners such as China and Germany.

The government has indicated it is concerned about French debt being downgraded by international rating agencies.


The new budget cuts come on top of €16 billion of reduced spending already inscribed in the 2024 budget, largely due to the phase-out of energy subsidies introduced when gas and electricity prices soared after Russia's invasion of Ukraine.

Sources in the French finance ministry have also warned that the 2023 deficit might have overshot its target of 4.9 percent of GDP. 


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