France's newly appointed Prime Minister set to face his first major test in parliament
Date
1/16/2025 6:01:56 AM
(MENAFN) France's newly appointed Prime Minister, Francois Bayrou, is set to face his first major test in parliament on Tuesday, as his government struggles with a lack of a parliamentary majority, amidst unprecedented Political instability. Bayrou will deliver a public speech to lawmakers, outlining his key priorities, including important budget decisions, just one month after being appointed by President Emmanuel Macron. Bayrou's primary challenge is passing the 2025 budget. In the wake of the previous government's collapse, emergency legislation allowed the state to collect taxes and cover basic expenses to avoid a shutdown. However, a balanced budget is essential to reduce France's deficit and fund critical expenditures, such as defense measures in the ongoing Ukraine war and aid to protesting farmers.
The financial community, including markets, rating agencies, and the European Commission, is pressuring France to adhere to EU debt rules and avoid rising borrowing costs, which could undermine the economic stability of the eurozone. France's deficit is expected to reach 6% of GDP in 2024, and Finance Minister Eric Lombard has expressed hopes of reducing it to 5-5.5% this year. Bayrou, upon taking office, acknowledged the enormity of the challenges ahead, comparing them to the "Himalayas." His government relies on a fragile alliance between Macron's centrist allies and conservative lawmakers from the Les Républicains party, but they do not hold a parliamentary majority.
The previous government lasted only three months before being ousted over budget disputes, and Bayrou is working to secure a pact with the Socialists to avoid a similar fate. The Socialists have expressed willingness to engage in dialogue, provided that pension reform, which was passed two years ago and remains unpopular, is included in discussions. However, the risk of a new vote of no confidence remains, with the far-left France Uncontrolled party already announcing its intention to submit one.
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