EU Backs France in Ambitious Budget Deficit Cut

The EU supports French Prime Minister Francois Bayrou's revised plan to cut the budget deficit below 3% of GDP by 2029. The updated plan is approved, adhering to the EU's requirements, and was designed after the previous proposal by Michel Barnier was rejected by the French Parliament.

European Union finance ministers are set to approve French Prime Minister Francois Bayrou's deficit-reducing strategy, aligning with EU guidelines to lower the nation's deficit to under 3% of GDP by 2029, according to informed sources.

Endorsed by senior EU officials, Bayrou's plan will succeed a previous proposal from ex-Prime Minister Michel Barnier, which the French Parliament turned down late last year. French Finance Minister Eric Lombard reiterated the commitment to meet the 3% target by 2029 during a press briefing in Brussels.

The revised approach seeks to bring France's budget deficit to 5.4% of GDP this year, a shift from the European Commission's earlier estimate for 2024. Although Barnier's earlier plan aimed for a steeper reduction by 2025, both strategies share the ultimate target for 2029, satisfying EU conditions for approval.

(With inputs from agencies.)