Instant View: Reaction to France's 2013 budget

LONDON (Reuters) - President Francois Hollande's Socialist government unveiled steep tax hikes on business and the rich on Friday in a 2013 budget aimed at showing France has the fiscal credentials to remain at the core of the euro zone.

Following are analysts' reaction to the draft approved by the cabinet.

PHILIPPE WAECHTER, ECONOMIST, NATIXIS ASSET MANAGEMENT

"What raises a few questions for me is how will the conditions arise to reach the 3 percent (deficit-to-GDP ratio) with an optimistic growth forecast."

"The ambitions that were flagged are very audacious ... I have a hard time seeing the story how we're going to find the necessary growth in 2013 and afterwards... So far we have a lot of numbers and not the story."

GILLES CARREZ, CONSERVATIVE CHAIRMAN OF FRENCH PARLIAMENT'S FINANCE COMMITTEE

"Never have households and companies been subjected to such a fiscal shock. It's a very bad choice. More savings should have been made...

"There are no structural measures. Therefore, it's a short term-focused budget with no vision. There's nothing about the competitiveness of companies whereas that should a major priority."

PATRICK JACQ, RATE STRATEGIST, BNP PARIBAS, PARIS

"The important thing is that the deficit target can be achieved even if there might have to be some adjustments in a mini-budget next year."

"The gross debt supply should be lower than this year's and this should be positive for bond markets."

ERIC CHANEY, CHIEF ECONOMIST, AXA

"The government has understood that the increase in the public debt has got to be halted but the way that they are doing it is not the right way. It amounts to strongly increasing the tax burden on companies, their shareholders and executives, in other words those who create added value."

"It will lead to an even bigger loss of competitiveness and so a reduction in long-term growth. That will in turn keep the deficit and debt from being reduced over the long term."

(Reporting By Paris bureau and London markets team; Compiled by London editing desk)

Source: http://news.yahoo.com/instant-view-reaction-frances-2013-budget-105028544--finance.html

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