Posted by The Corner on September 23, 2024
In an interview yesterday, Prime Minister Michel Barnier said the fiscal situation was “very serious”. Since most of France’s debt is issued on the international market, he stressed that “France’s creditworthiness must be maintained”. He said that “we will not raise taxes on the entire French population”, but that “we will not exclude the richest from the national effort that must be undertaken”, to which “the very large companies and multinationals that are functioning well can also contribute”. The composition of the new government was announced last Saturday, with 39 ministers from the centre-right coalition of Macron and Barnier’s conservative Republicans.
Our analysis: The new Barnier government must present a draft budget for 2025. The budget deficit for 2023 will reach 5.5% of GDP, and the Treasury has already indicated that France will end the year with a 5.6% deficit, far from the EMU target of 3%. France has been undergoing a deficit correction procedure since July last year.
