France’s prime minister warned Tuesday that the country faced a Greek-scale financial crisis if it doesn’t act decisively to rein in its ballooning debt and deficit. He proposed a series of drastic measures to mend the nation’s budget, including scrapping two national holidays.
In a sobering speech to lawmakers and members of President Emmanuel Macron’s cabinet, Prime Minister François Bayrou said that France’s debt had risen higher than that of almost every other country in Europe, reaching 114 percent of gross domestic product. Bringing it down in the coming years would require freezing nonmilitary spending and encouraging the French to “work more.”
“It’s the last stop before the cliff, before we are crushed by the debt,” Mr. Bayrou said.
President Trump’s threat to impose 30 percent tariffs on European Union goods posed an additional risk to the French and European economies, he added.
Mr. Bayrou’s spending cuts would include not replacing one out of three civil servants when they retired and eliminating “unproductive” state agencies. He would also scale back France’s subsidies for prescription medicine, saying that the French “consume twice as many antibiotics as the Germans.”
The measure most likely to rankle the French was a proposal to scrap two national holidays: Easter Monday and May 8, which commemorates the end of the Second World War in Europe and is often used as a “bridge” by the French to take a four-day weekend in the middle of spring.
“It’s the entire country going back to work on a day it hasn’t worked for a long time,” he said, adding that the holiday cuts would bring “several billion euros” to French coffers because of higher production. France has 11 national public holidays, the same as the United States.
The belt-tightening proposals, part of an outline for the 2026 budget that the Parliament will consider later in the year, are likely to renew public furor over France’s finances. Back in 2003, when France suffered a deadly and economically devastating heat wave, the government tried to drop the Ascension Day holiday to raise money, only to be repelled by street protests.
In recent years, raucous demonstrations have rocked France over an increase in the retirement age — a move taken by Mr. Macron to curb government spending which, at 57 percent of gross domestic product, is among the highest in Europe. One of Mr. Bayrou’s proposals would cap pension payments, an issue likely to rekindle the flames.
Mr. Bayrou’s political fortunes are already on the line: As the head of a minority government with a Parliament divided into three opposing camps, there is a high chance he could be out of office before completing the job of trying to fix France’s finances. The previous prime minister, Michel Barnier, was ousted in December by a no-confidence vote after he tried to rein in the budget.
His overall plan drew an immediate rebuke from the right and the left, with Marine Le Pen, the leader of the far-right National Rally, and Jean-Luc Mélenchon, leader of the far-left France Unbowed party, threatening Mr. Bayrou with a censure motion if he didn’t revise his proposals.
Mujtaba Rahman, managing director of Europe for Eurasia Group, said that Mr. Bayrou “has gone for broke, knowing full well these measures have little chance of passing.”
France, a cornerstone economy in Europe, has become a weak link as its deteriorating financial situation has generated concern among investors and credit ratings agencies. The deficit, at 5.8 percent of economic output, is the biggest in the eurozone. This year France is expected to pay 55 billion euros (around $64 billion) to cover the interest on its debt, more than the country’s military budget.
If nothing is done, debt interest would become the government’s largest expense by 2029, ballooning to €100 billion per year, Mr. Bayrou said. “We should never forget what happened to Greece,” he said, evoking that country’s punishing debt crisis earlier this century.
The proposed belt-tightening would go along with a program to ramp up economic production, especially on defense. France has some of Europe’s biggest weapons makers, and there is a push to speed up the manufacture of everything from tanks to fighter jets to help offset a decline in other industries.
But that would require getting more people into work, Mr. Bayrou said, in part by tightening up France’s generous unemployment system.
“There aren’t enough of us working,” he said.
Ségolène Le Stradic contributed reporting.
Liz Alderman is the chief European business correspondent, writing about economic, social and policy developments around Europe.
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