France cuts 2019 economic growth view
Print Edition
The French government has lowered its economic growth forecast for next year to 1.7 percent and unveiled plans to cut public spending in an effort to stay in line with European Union budget commitments.
In an interview yesterday with Le Journal du Dimanche, Prime Minister Edouard Philippe said the government will base its 2019 budget on that reduced estimated growth, down from the previous estimate of 1.9 percent. He said France is still committed to be in line with EU rules regarding public deficits.
“If growth slows down, there will naturally be an impact,” he said. “But that will not prevent us from sticking to our commitments on cutting taxes while controlling public spending and debt.”
Philippe explained some measures included in the 2019 budget, which is to be formally presented at the end of September. He said pensions and family and housing benefits will not be pegged to inflation anymore — meaning they will increase at a more moderate pace.
He promised the government would not cut down benefits aimed at helping the poorest.
He said the French government will cut 4,500 public service jobs next year and 10,000 in 2020.
President Emmanuel Macron has pledged to pursue labor changes in the coming months, with a focus on small businesses, in an effort to boost growth.
Philippe also unveiled plans to cut taxes paid by workers on overtime hours, starting from September 2019. He said the measure will give an extra 200 euros (US$233) per year to workers who earn the French minimum wage.
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