UPDATE 1-French defence spend flat in 2014 - Hollande

Thu Mar 28, 2013 5:41pm EDT

PARIS, March 28 (Reuters) - French President Francois Hollande said on Thursday there would be no cuts to the country's 31-billion-euro annual defence budget next year despite pressure to save billions of euros in public spending.

Hollande's Socialist government is eyeing its defence budget as it struggles to pare down a large public spending bill and meet public deficit targets, telling ministries they must save an extra 5 billion euros in 2014.

The military has been braced for the sharpest cuts, with some analysts predicting that France may have to sell its only aircraft carrier to meet a possible cumulative savings target of 15-30 billion euros between 2014 and 2019.

"We will spend exactly the same amount in 2014 as in 2013," the Socialist president said during an interview on France 2 television, announcing an effective freeze on spending next year.

Hollande gave no details on spending beyond 2014. Analysts have predicted the military budget, currently at 1.56 percent of gross domestic product, will be cut even further below a recommended NATO level of 2 percent of GDP.

The country's top seven defence contractors including Thales , Safran and Nexter wrote to Hollande this month warning him of the risk of cutting back on defence spending amid high unemployment.

The president said he admired the military's efforts during an operation in Mali and would ensure that France retained the ability to ensure its security independently, which he said included keeping its nuclear arsenal up to date.

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