France already has a new Government. The French Prime Minister, François Bayrou, said it would be ready before Christmas and, barely, but he has achieved it. This Monday he revealed the composition of the new Executive, a continuous team compared to that of the predecessor, Michel Barnier, and with some heavyweights such as Manuel Vallswho will be a minister and will direct the Overseas portfolio, or the banker Eric Lombard who will be responsible for Economy.
Since June, France has been immersed in a political crisis. President Emmanuel Macron announced new elections at the threshold of summer after the overwhelming victory of Marine Le Pen, from the extreme right, in the European elections. Michel Barnier emerged as prime minister from the new electoral call, but His Government – made up of three complex blocks of the left, center-right and extreme right – collapsed and was overthrown in a historic motion of no confidence in parliament.
With the new leader elected (Bayrou, 73 years old and leader of the center-right Democratic Movement party), today it was announced who his team will be in which this time no representative of the left is included. And it is not because Bayrou has not tried to avoid having to depend on the extreme right.
However, the Socialists, who are the most moderate of the majority left alliance in the lower house, considered that the concessions offered to them were insufficient. “We are dismayed by the poverty of what has been proposed,” said the leader of the Socialist Party (PS), Olivier Faure, last Thursday, ensuring that his party has not yet found “any reason not to censure” Bayrou.
On the other hand, the new Executive does have François RebsamenMinister of Decentralization, of socialist origin, and Manuel Valls himself, who was already minister under François Hollande. Although on the other hand, in the Ministry of the Interior it will continue Bruno Retailleaufrom the toughest and most popular French right, for its firm commitment to the fight against irregular immigration. The Minister of Foreign Affairs will also remain in office, Jean-Noel Barrot and the Minister of Defense, Sebastien Lecornu.
Among other names, he has also named former Interior Minister Gerard Darmanin Minister of Justice; Elisabeth Bornewho resigned as prime minister in January and will now have the Education portfolio; Eric Lombard, 66, director of the Caisse des Dépots, will be finance minister, working with Amélie de Montchalin as budget minister. Thus, once the Government is formed, Bayrou hopes that he will be able to oversee the approval of a budget for 2025 and avoid a collapse that would deepen the country’s crisis.
France faces a long and complicated journey to clean up its economy. According to the National Institute of Statistics (Insee, for its acronym in French), public debt reached 3.3 trillion euros in the third quarter of 2024which represents 113.7% of GDP. Furthermore, the country’s public deficit is expected to exceed 6% of GDP this year.
To correct this situation, the government led by former Prime Minister Michel Barnier considered that it was it is necessary to carry out an adjustment of 60,000 million eurosthrough a combination of spending cuts and tax increases. However, the budgets proposed by Barnier, which he tried to approve by decree in the face of opposition from the left and the extreme right, triggered his downfall and marked the end of his mandate.
The appointment of François Bayrou as successor has also generated uncertainty among investors. As proof of this, the agency Moody’s downgraded France’s sovereign rating to “Aa3” with a stable outlook, questioning the Government’s ability to implement the necessary measures to avoid budget deficits greater than expected.
