France is embarking on a challenging financial overhaul to address its mounting public debt and deficit issues. Prime Minister Michel Barnier's 2025 budget aims to cut public spending by €40 billion and raise taxes by €20 billion, targeting large corporations and wealthy individuals. The goal is to reduce the deficit to 5% of GDP by 2025. Key measures include reducing public sector jobs and delaying pension revaluations. The defence budget will see an increase, while local government contributions and social protection spending face cuts.
The French government, led by a fragile coalition, will navigate a difficult legislative process to pass these budgetary measures. Facing a potential backlash, the government has hinted at using constitutional tools to ensure passage if parliamentary support falters. This financial strategy is seen as crucial for maintaining France's credibility in international markets, especially with the EU scrutinizing its deficit. Despite the challenges, the government remains committed to implementing these changes to stabilize the nation's finances. The upcoming parliamentary debates will be pivotal in shaping the final budget outcome.
