France more than doubles crisis budget package to 100 billion euros

PARIS (Reuters) – The French government on Thursday more than doubled the expected cost of its crisis response measures to cope with the worst recession since at least World War Two, pushing the budget deficit and national debt to record levels.

Finance Minister Bruno Le Maire told Les Echos newspaper that the government now expected its crisis package to cost 100 billion euros ($108.6 billion) – over 4% of GDP and up from expectations of 45 billion euros less than a month ago.

“These numbers could yet change as the economic situation and companies’ need of support is changing fast. We’re going all out to save our companies,” Le Maire said.

The government will present its second update to the 2020 budget in as many months next Wednesday, which Le Maire said forecast that the economy would contract 6% – the most since 1945.

With economic activity in freefall and crisis spending spiralling, the government’s public sector budget deficit would hit 7.6% of economic output this year, budget minister Gerald Darmanin said in the joint interview with Le Maire.

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