French Budget Deficit Grows
Aug. 06, 2003
PARIS (AP) _ France's budget deficit swelled in the first half of 2003 as a weak economy drained tax revenues, raising the prospect that the full-year deficit will surpass limits set by the European Union.
The deficit between January and June was euro36.19 billion ($41.04 billion), the Finance Ministry said Wednesday, up 38 percent from the euro26.19 billion gap in the same period in 2002.
For 2002 overall, the budget gap was euro49.3 billion, or 3.1 percent of gross domestic product. The government projects a budget gap of 3.4 percent of GDP this year, but Wednesday's figures suggest the figure could approach 4 percent of GDP.
The finance ministry said a 6 percent decline in revenues in the first half accounted for about three-quarters of the budget slippage. Corporate tax revenues fell 11 percent compared to 2002, while value-added tax revenues rose 0.3 percent in the first half of the year.
Meanwhile, state spending rose 0.5 percent between January and June compared to a year earlier.