A billion-euro hole in the national budget means that compliance with the Maastricht criteria has become nothing more than wishful thinking for Paris. The country has accumulated total debts of over €3,100 billion, which corresponds to 111.9 per cent of GDP and is the third highest figure in the EU. By way of comparison, according to statista.com, Germany has a national debt of €2,630 billion, or 64.8 per cent of GDP. The EU average is currently 82.6 per cent of GDP.
France is threatening to become another financial problem child in Europe, almost like Greece. Only much bigger.
The high level of debt is partly due to extensive government support measures taken during the pandemic to secure jobs and support businesses. These measures included short-time working allowances, direct grants and tax incentives aimed at preventing economic collapse.
In addition to pandemic-related spending, France has also invested in infrastructure, green energy and education to promote long-term growth. These investments are intended to help modernise the economy and increase competitiveness, but will place further strain on the national budget in the short term.
Another factor contributing to the debt burden is demographic challenges. Like many other European countries, France faces an ageing population, which requires higher spending on pensions and healthcare. This spending increases pressure on the budget and makes it more difficult to reduce the debt ratio.
France's current debt remains a critical issue that requires careful planning and strategic decisions to stabilise the economy and ensure sustainable growth in the long term. This sounds familiar, as the British government faces similar challenges to France in terms of public finances – albeit not quite as dramatic.
https://www.tagesschau.de/ausland/europa/frankreich-haushaltsdefizit-100.html
