France's budget minister said yesterday that economic growth of 2.5 per cent this year was "very realistic" and that it could be even higher.

"The latest figures from INSEE [the state statistics body\] make the forecast of 2.5 percent very realistic and even allow to perhaps hope for a bit more," Mr Dominique Bussereau told Les Echos financial daily.

He added that virtually all additional receipts garnered from higher-than-forecast growth would be earmarked for reducing the country's €1 trillion public debt. The 2004 budget was based on growth of 1.7 per cent.

Consumers powered the French economy to surprisingly strong growth in the second quarter of 0.8 per cent, a performance Bussereau also attributed to a resumption of investment.

In the same interview, Mr Bussereau, who is close to France's prime minister Mr Jean-Pierre Raffarin, said the government had shelved for the time being plans to declare a fiscal amnesty in order to attract capital back into the country.

"Such a measure will not feature in the 2005 budget," Mr Bussereau told the paper.

However, France and Germany could ask the European Commission to draw up a proposal for across the 25-nation union.

He also ruled out reform of the country's wealth tax. - (Reuters)