“The signals of a crisis which could reverberate throughout Europe are multiplying”, analyzes the Portuguese daily Publicon the subject of the political crisis in France by the negotiations around the 2025 budget. The foreign press is worried about the institutional and financial instability of the “second economy of the euro zone”, and its possible consequences in the region.
Faced with the political uncertainty which has continued since the dissolution of the National Assembly in June, and the threat of government censorship, the markets are becoming increasingly agitated. France’s borrowing rate is currently higher than those of Spain and Portugal, and for the first time on Wednesday November 27, it briefly exceeded that of Greece, a country which came close to bankruptcy after the 2008 crisis. .
“Frightened investors”
A signal spotted by the Financial Timeswho asks: “Is France heading towards a Greek-style debt crisis?” Before tempering: “The scenario seems exaggerated […]. During the recent political turbulence in France, the gap between its debt and that of Germany increased by only 0.3 percentage points”, reassures the economic daily. It is in reality “the combination of political paralysis and precarious public finances” which frightens investors, and not the economic health of the country – as could have been the case for the economies of southern Europe, following the 2008 crisis.
But if the causes of the instability are different, the situation remains no less worrying for the economic media Bloombergwhich notes that “the French benchmark stock index is on track to experience its worst year compared to European stocks since 2010”, with sales of French assets increasing in recent times. “Plunged into a growing budgetary mess, France is heading towards humiliation on the financial markets”, summarizes Politico from Brussels.
Consequences for the euro zone?
Beyond the political saga, it is above all the possible repercussions of a financial crisis in one of the pillars of the European economy which concerns our neighbors. “The European Central Bank warned last week that the European Union could be on the brink of a new eurozone debt crisis due to weak growth and political uncertainty in several countries, including its largest economies” including Germany, notes Public.
All describe the political slump in which France has been plunged since the dissolution, with no prospect of a short-term outcome. “It’s a political waste,” says the Spanish daily El País. What had started as a simple poker game between those who separated from the government to gain visibility is now a labyrinth from which it will be difficult to escape.” A reference to the attitude of Marine Le Pen and the National Rally (RN) , who initially tacitly supported the government, before letting go of its hand.
The RN could “discredit itself”
A contradiction that the Financial Times : “The problem [du RN] is that its strategy consists of both being considered as a respectable party which […] guarantees a certain stability, while not disappointing its electorate”, in particular in the face of a proposed austerity budget – targeting 60 billion savings – and so unpopular.
The legal affairs of the leader of the RN group in the Assembly are also cited as a potential cause of this reversal. Cornered before the courts for a case of embezzlement of European funds, Marine Le Pen awaits a sentence on March 31 which could disqualify her from any political mandate for five years, excluding her from the presidential election. “If she has to die (politically), Le Pen prefers to do it by killing,” observes El País.
But by playing with fire, the far-right elected official could get burned, according to the German daily South German Zeitung : “The populist has been trying for several years to establish her credibility with the economic sector – not without some success. By letting go of Michel Barnier now, she would risk once again undermining her political capital.”
Towards a resignation of Emmanuel Macron?
Seen from abroad, the political crisis does not seem any closer to ending. “The difficulties in passing the budget do not bode well for the long-term survival of the Barnier government nor for the future governability of France,” notes the Financial Times. If the government were to fall, Parliament could pass emergency legislation to extend this year’s budget. […] However, the possibilities of forming a parliamentary majority are only shrinking.”
This prolonged paralysis would risk increasing pressure on the President of the Republic, seen as one of the only ones able to unblock the situation by resigning, with new legislative elections not being possible again under his mandate until the summer. next. A presidential election could allow “a political restart”, suggests the American economic daily. Could leaving power be part of Emmanuel Macron’s strategy? “Not sure. That said, he showed that he could surprise us,” concludes the Financial Times.