PARIS: France is in “very close talks” with debt rating agency Standard and Poor’s, Prime Minister Elisabeth Borne said Sunday, after a downgrade from rival Fitch reignited government finance concerns in the EU’s second-largest economy.

Finance Minister Bruno Le Maire had offered “detailed explanations to Standard and Poor’s of everything we’re doing to get our public finances under control” ahead of their rating decision in early June, Borne told Jewish community broadcaster Radio J.

Citing “relatively large fiscal deficits and only modest progress with fiscal consolidation,” Fitch last month downgraded France’s debt rating to AA-, several notches below the top AAA class awarded to countries including Germany and the Netherlands.

Such ratings help determine borrowing conditions when governments go to financial markets to raise money.

France’s debt hit almost 112 percent of annual output by the end of last year, driven by a “whatever-it-takes” response to the coronavirus crisis and generous support to households and firms through the energy price crunch provoked by Russia’s invasion of Ukraine.

“We’ve introduced reforms, we’ve recently revealed a path for government finances into 2027... reducing our deficit to 2.7 percent of GDP” from its present level closer to 5.0 percent, Borne said.

The finance ministry hopes controls on government spending combined with faster growth can bring overall debt levels down to 108 percent of GDP in the coming five years.