France’s debt reaches 95% of GDP in 2014

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The French institute for national statistics, INSEE, has published debt figures for Q4 2014. The French government debt has reached €2,037.8bn at the end of Q4 2014, up €2.4bn compared to Q3 2014.

It accounted for 95% as a share of GDP “0.2 point lower than Q3 2014’s figure, as the GDP grew slightly,” explained the INSEE.

French finance minister Michel Sapin, responded in an interview with I-Télé, stating: “the debt won’t reach 100% of the GDP because we control our debt and our expenses.”

In detail, the contribution of the State to the debt has increased by €0.6bn in Q4 2014. “Long-term negotiable debt went up (+€16.4bn) whereas short-term negotiable debt dropped (-€15,2bn),” exposed the INSEE.

In the meantime, deposits to the Treasury declined  (-€0.9bn).

The contribution of central agencies, which are central government units other than the state, rose by €1.3bn, driven by deposits to the Fonds de Garantie des Dépôts et de Résolution (FGDR) for +€0.4bn and by loans for +€0.9bn.

Local government’s contribution has increased “significantly” (+€8.1bn), taking out €11.1bn of long-term loans while paying back €3bn of short-term loans.

The net public debt growth is more dynamic (+€20.9bn) added the institute.

At the end of Q4 2014, the net public debt has reached €1,849.9bn (equivalent to 86.3 % of GDP as opposed to 85.6 % in Q3 2014), up €20.9bn in comparison to Q3 2014.

The INSEE explained the gap between changes in net and gross debt by “a drop of both the State’s treasury (-€14.1bn) and the social security funds’one (-€4.8bn)”.

As for the government deficit, results were better than expected. It has reached –€84.8bn and accounted for 4% of France’s GDP as a share against 4.1% in 2013.

Sapin commented in a press release : “The control of the public deficit in 2014 leads the way to revise it down in 2015 around 3.8% of the GDP.” Previously, the objective was 4.1% of the GDP for 2015.

The European Commission has recently extended the deadline for France to bring its public deficit below 3% of its GDP to 2017 .

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Adrien Paredes-Vanheule
Adrien Paredes-Vanheule is French-Speaking Europe Correspondent for InvestmentEurope, covering France, Belgium, Geneva and Monaco. Prior to joining InvestmentEurope, he spent almost five years writing for various publications in Monaco, primarily as a criminal and financial court reporter. Before that, he worked for newspapers and radio stations in France, in particular in Lyon.

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