France Faces IMF Oversight Threat Amidst Budget Crisis
Budget Minister Amelie de Montchalin warns that France needs urgent financial reforms to avoid supervision by the IMF or European institutions. The government plans a significant budget adjustment by 2026 to address its substantial public sector deficit, which is the largest in the euro zone.
- Country:
- France
France is being urged to rectify its financial situation or risk supervision by the International Monetary Fund (IMF) or European bodies, Budget Minister Amelie de Montchalin announced. Highlighting the need for budgetary discipline, she noted that external institutions could intervene if France doesn't swiftly act.
Prime Minister Francois Bayrou aims to introduce fiscal reforms in July, targeting a 40-billion-euro budget contraction by 2026. The move comes as France grapples with a significant public sector deficit, the largest within the euro zone, currently estimated at 5.4% of economic output for this year.
France's history of exceeding European Union budget guidelines underscores the urgency. As economic analysts watch closely, potential IMF oversight looms as a stark possibility, pressuring France to take decisive fiscal measures.
(With inputs from agencies.)
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