In a pivotal legislative moment, major economic observers are increasing calls for clarity. This Tuesday, the governor of the Bank of France, François Villeroy de Galhau, warned of the risks that “ the confusion » around the way in which France was going “ control your debt ».
For him, “ investors who lend to France, and the French themselves – whether entrepreneurs or households – expect clarity, confidence, on how we are going to reduce our deficits and control our debt. »
Brussels, S&P… here is the hour of judgment for the Barnier budget
A reference to the many challenges facing the government, ebetween negotiations with the main opposition leaders in Parliament, the budget examination in the Senate, opinion of the European Commission and verdict of the agency S&P on the French note. As a reminder, in search of 60 billion euros in savings to restore flagging public finances and reduce the deficit to 5% of GDP in 2025, the government presented its draft budget for 2025 to the Senate on Monday. uncertainties remain over the outcome of this text: the National Rally does not hide its intention to vote on one of the motions of censure which will be tabled by the left if the three texts remain ” in the state » according to Marine Le Pen. With the deputies of the New Popular Front, the majority would be reached and the government of Michel Barnier overthrown.
Blockage of investments and hiring
In the event of a reversal, the economic consequences could be severe.
« The more uncertainty there is rather than confidence, the more businesses and SMEs risk postponing their investments and hiring. », he added, on the occasion of the Investing Day conference.
« France must change its budgetary trajectory (…) Not only because of compliance with European excessive deficit rules, but also and above all in our national interest », Also declared François Villeroy de Galhau. For him, “ returning to 3% (deficit in 2029) as proposed by the government is essential. Otherwise, we will remain this exception in Europe: the country whose public debt continues to increase after Covid while all the others have fallen. »
The sad record of business failures is reached
The CPME also calls for clarification of the budget
And the governor of the Bank of France is not the only one to warn of the dangers of a government overthrow on the economy. Government spokesperson Maud Bregeon said on Saturday that she feared, in the event of censorship, a financial crisis and “ a Greek scenario », in which civil servants would not be paid in January.
For his part, this Tuesday, the president of the Confederation of Small Medium Enterprises (CPME) François Asselin judged “ that we absolutely need a budget ”, to then start to have “ prospects ». « It is not a question of saying “I am for or against the Barnier government”, but “what is needed for France?” ”, according to him. Like all employers, he asked that the text not add to the “ burden » companies by removing reductions in employer contributions as planned. These reductions were introduced to “ compensate for the catastrophic decision of 1997, the move to 35 hours “, he added.
(With AFP)
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