Overview

• Prime Minister François Bayrou has announced a €40 billion austerity plan for the 2026 budget, aiming to reduce the deficit from 5.4% to 4.6% of GDP.
• Bayrou ruled out increasing taxes or borrowing, citing France's already high tax burden and the unsustainable nature of further debt accumulation.
• The national debt, currently at 113% of GDP, is described as a 'dangerous trap,' with interest costs projected to reach €100 billion annually by 2029.
• Opposition parties have threatened censure motions, while unions and local authorities criticize the plan as inequitable and lacking in transparency.
• The government has committed to unveiling detailed budgetary orientations by July 14, accelerating the timeline for stakeholder consultations and decision-making.