French President Francois Hollande said he will cut €50bn from government spending by 2017 in a bid to bring down the deficit in his country's public finances and permanently lift the economy back to growth.
The French economy is struggling to grow despite tentative signs of a dawning recovery for the troubled eurozone currency area, of which France is a prominent member state. In the third quarter, French GDP contracted by 0.1%. Over the same period, eurozone GDP grew by 0.1%.
Unemployment is also high, clocking in at a rate of 10.9%. Hollande is pursuing labour market reforms to loosen the grip of regulations on employers in the hope that more jobs will be created.
He pledged to make France's tax regime competitive to encourage investment in jobs and growth and secure a sustainable economic recovery. As a start he promised to shave €30bn off of French firms' tax bills by no longer requiring them to fund family welfare.
"We must do everything for employment. This is my priority," Hollande told reporters at a Paris press conference.
Hollande's spending cuts will amount to 4% of French GDP and will take place between 2015 and 2017. As a whole, public spending accounts for 57% of GDP, one of the highest rates in Europe.
The country's finance ministry has a budget deficit equivalent to 4.1% of GDP, well above the 3% level agreed by the European Union under the Maastricht Treaty.
French public debt is also in breach of Maastricht standards, which dictate it must not get above 60% of GDP. It is forecast to hit 95.1% in 2014. Just servicing the debt will cost €46.7bn (£39bn, $64bn) a year.
A stagnant French economy has left Hollande, a socialist, unpopular among the population. He was the most unpopular French president on record according to one poll by BVA, where his rating in October of 26% was the lowest in the survey's 32 year history.
In his speech, Hollande said France must restore its economic strength in order to retain its influence in Europe and beyond.
France is already slashing public budgets by €15bn in 2014 alone.