French Prime Minister Barnier Warns of “Very Serious” Budgetary Situation

French Prime Minister Michel Barnier has raised concerns over the country’s budgetary position, calling the situation “very serious” during a statement to AFP on Wednesday. Barnier, who took office earlier this month, emphasized the need for more detailed assessments to understand the “precise reality” of France’s public finances.

France is currently under a formal EU procedure for violating the bloc’s budgetary rules, a situation that arose before Barnier’s appointment. The Bank of France also warned earlier this week that the government’s plan to return to EU deficit limits by 2027 is “not realistic.” The EU requires member states to keep their deficits under 3% of GDP, but France’s public sector deficit is projected to hit 5.6% this year and exceed 6% by 2025.

Appointed by President Emmanuel Macron after a challenging parliamentary election, Barnier has suggested potential tax hikes to stabilize the budget, a proposal Macron has consistently rejected throughout his presidency. Barnier remarked, “This situation requires more than just pretty statements. It requires responsible action.”

As the new prime minister prepares to appoint his cabinet, his first major challenge will be submitting the 2025 budget to parliament next month. This is expected to be a significant test for Barnier’s administration, particularly as it confronts the growing pressure of fiscal imbalance.