France expects growth of only 1%, blaming wars in Ukraine and Gaza

PARIS, France: France has lowered its expectations for growth in 2024, blaming the impact of the wars in Ukraine and Gaza, along with slowdowns with trading partners Germany and China.

Speaking to reporters, French Finance Minister Bruno Le Maire said his ministry had lowered its forecast for 2024 GDP growth to 1 percent from 1.4 percent.

Speaking to French television TF1, Le Maire said it would also be necessary to reduce state spending by $10.8 billion. The cutbacks would be spread across all departments and agencies, he added.

"It is a growth forecast that remains positive, but takes into account the new geopolitical context," Le Maire said. He noted that the French economy was suffering due to the war in Ukraine and the Middle East, difficulties with maritime transport in the Red Sea, and the economic slowdowns in China and Germany.

However, in a bid to reassure the public, Le Maire noted that there would be no tax increases and no cuts in social security payments to citizens. He did say all government agencies and ministries would see their budgets reduced.

"We will immediately cut, in the coming days, ten billion euros in state expenditures," he said.

At the same time, Le Maire pledged that the government would abide by earlier commitments to reduce the 2024 state deficit to 4.4% of GDP.

"We are keeping the option of implementing a supplementary budget in the summer, depending on economic circumstances and the political situation," he said.