Monday, November 17, 2008
A new estimate of the 2008 deficit: 51.4 billion euros, or 2.9% of GDP, which I think is probably based on an estimate of GDP that is too optimistic. So it's quite likely that France will exceed the 3% SGP limit--not that it matters much in the crisis, since the emergency clause is surely operative. Indeed, this estimate ignores any possible stimulus initiatives, to which France is presumably now committed along with other G20 powers. It seems odd even to offer a deficit estimate until a stimulus package has been decided upon, but we've heard little in the way of concrete proposals from the ministry of finance or the president.