2024-09-27 10:20:55
It represented 112% of GDP at the end of the second quarter, according to the latest figures published this Friday morning by INSEE. In seven years, the currency has jumped by more than 900 billion euros.
It’s a litany of stratospheric numbers, so big they seem unreal. With each INSEE publication on the evolution of its debt, France, almost resigned, rediscovers the scale of the hole which continues to expand in its budget. Each time, billions more are added to the already dizzying pile. The amount is almost derisory compared to the top that will have to be paid back one day. The latest estimate from INSEE is no exception: at the end of the second quarter, public debt reached 3,228.4 euros, according to national statistics. A staggering number, which represents 112% of France’s GDP. The highest level since the third quarter of 2022.
The increase in debt was approximately 69 billion euros over three months, and 127 billion euros over the first half. In the second quarter, it was driven by public debt, which jumped by almost 70 billion euros, and that of social security administrations, by 4 billion euros. In contrast, the debts of central administrations and local authorities fell slightly, “Mainly due to the reduction in debt of SNCF Réseau” and thanks to the efforts of departments and regions.
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French, poor European student
Read at a leisurely pace, figures from national statisticians reveal two major worrying trends. First, the debt experiment, in the medium term, is not consistent, with billions of euros added every ten years recently. The milestones of 1000 billion euros were now passed in 2003, of 2000 ten years later, and of 3000 in 2023. And this, despite repeated warnings from those familiar with the matter, that warn, loud and clear, against blindness. who followed the leader.
Some figures show a disastrous aspect of public finances. In twenty years, the debt has increased from 1082 billion euros at the beginning of 2004 to more than 3225 billion euros in mid-2024. The increase is remarkable over ten years, with 1,160 billion euros more since 2014. The results are very heavy from the election of Emmanuel Macron: that, between mid-2017 and the end of 2019, the increase is at the end in the end, in 105 billion euros, the Covid-19 pandemic and the “whatever it is” has passed in this way, causing the debt to increase by more than 560 billion between the end of 2019 and the end of 2022. The trend has not slowed down after the Covid-19 pandemic, the debt has increased by 275 billion dollars Europe, which is included in particular by measures in favor of purchasing power. In seven years, the currency has jumped by more than 935 billion euros…
Secondly, France is a bad student in the European Union, according to Eurostat. At 110.8% in the first quarter of 2024, the country is now the bronze medalist, in terms of countries with the highest percentage of public debt to GDP, behind Greece and Italy. Far above the Euro area average, established at 88.7%. And, where some capitals have managed to manage their debt in recent years, such as Greece, Portugal, Cyprus, Croatia or the Netherlands, France’s share has decreased slightly.
Read againBertille Bayart: “The debt which will lead Barnier to be the first minister of tax increases”
An outbreak to be brought under control as quickly as possible
The trees did not reach the sky, and France found herself, little by little, with her back to the wall. An increase in interest rates and an increase in the debt burden further limit the government’s room for wisdom, both in current plans and in financing future investments. Political uncertainty also weighs on the cost of borrowing: France is now more expensive than many of its partners, including Spain, Portugal and … Greece.
Enough to make the authorities react. “On the interest on the debt alone – I’m not even talking about paying it off – we will spend more than school”governor of the Bank of France recently concerned. François Villeroy de Galhau designed it “A well-measured cocktail”split between spending cuts, for three quarters, and targeted tax increases, for one quarter. “There are sources of savings that can be found without damaging public service, or even by improving it,” Pierre Moscovici emphasized, for the Court of Auditors, this week . This effort must be made: it is demanding, of course, but it is not impossible. “.
The government, for its part, says it has finally heard Cassandras. Listen in the Assembly, the new Minister of Finance, Laurent Saint-Martin, knows that the situation is “shade”. If the threat of a general tax increase is accepted by the Prime Minister, Michel Barnier, the taxes of certain companies and wealthy taxpayers may increase. At the same time, management will have to tighten their belts. Judgment during the presentation of the budget in front of Parliament on October 9.
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