Berliner Boersenzeitung - French public spending watchdog warns about post-Covid debt

EUR -
AED 3.917574
AFN 76.742265
ALL 101.29178
AMD 420.105081
ANG 1.92121
AOA 892.804731
ARS 929.329717
AUD 1.657623
AWG 1.92001
AZN 1.816187
BAM 1.958154
BBD 2.152368
BDT 116.990655
BGN 1.955332
BHD 0.402084
BIF 3054.801347
BMD 1.066672
BND 1.45216
BOB 7.381875
BRL 5.578792
BSD 1.065972
BTN 88.986386
BWP 14.805801
BYN 3.488562
BYR 20906.779677
BZD 2.148763
CAD 1.463832
CDF 2992.016024
CHF 0.972162
CLF 0.037078
CLP 1023.088489
CNY 7.726016
CNH 7.73426
COP 4175.35057
CRC 535.34363
CUC 1.066672
CUP 28.266819
CVE 110.397728
CZK 25.241948
DJF 189.826444
DKK 7.461251
DOP 62.90563
DZD 143.564975
EGP 51.700554
ERN 16.000086
ETB 60.569521
FJD 2.425453
FKP 0.856284
GBP 0.861301
GEL 2.842664
GGP 0.856284
GHS 14.338238
GIP 0.856284
GMD 72.424532
GNF 9164.103676
GTQ 8.290968
GYD 223.028141
HKD 8.3558
HNL 26.317641
HRK 7.552212
HTG 141.410677
HUF 394.073061
IDR 17306.173547
ILS 4.013195
IMP 0.856284
INR 88.973868
IQD 1396.465843
IRR 44866.909047
ISK 150.529045
JEP 0.856284
JMD 166.139745
JOD 0.756058
JPY 165.078133
KES 140.182376
KGS 94.951448
KHR 4332.228833
KMF 493.415969
KPW 960.005563
KRW 1471.39991
KWD 0.32875
KYD 0.88836
KZT 475.647399
LAK 22730.114731
LBP 95459.974109
LKR 321.954059
LRD 206.081336
LSL 20.427026
LTL 3.149606
LVL 0.645219
LYD 5.201205
MAD 10.799184
MDL 19.091775
MGA 4699.650267
MKD 61.627851
MMK 2238.570388
MNT 3680.020261
MOP 8.60044
MRU 42.349126
MUR 49.632536
MVR 16.479962
MWK 1847.821588
MXN 18.165745
MYR 5.104038
MZN 67.733315
NAD 20.426585
NGN 1147.472663
NIO 39.237542
NOK 11.746518
NPR 142.378178
NZD 1.804815
OMR 0.410627
PAB 1.065982
PEN 3.977382
PGK 4.05087
PHP 61.324048
PKR 296.669678
PLN 4.304531
PYG 7886.407688
QAR 3.88322
RON 4.976031
RSD 117.150557
RUB 100.153469
RWF 1374.552589
SAR 4.001304
SBD 9.002898
SCR 15.048606
SDG 625.070171
SEK 11.63521
SGD 1.45205
SHP 1.347687
SLE 24.370588
SLL 22367.591482
SOS 609.603536
SRD 36.829027
STD 22077.965749
SVC 9.327126
SYP 2680.046881
SZL 20.493639
THB 39.434593
TJS 11.646102
TMT 3.74402
TND 3.361051
TOP 2.55356
TRY 34.783013
TTD 7.238635
TWD 34.819176
TZS 2752.014554
UAH 42.442327
UGX 4061.883497
USD 1.066672
UYU 40.929208
UZS 13535.273106
VEF 3864076.923726
VES 38.71666
VND 27147.346743
VUV 126.637525
WST 2.990532
XAF 656.746589
XAG 0.038311
XAU 0.000451
XCD 2.882736
XDR 0.809473
XOF 656.740425
XPF 119.331742
YER 267.041519
ZAR 20.358542
ZMK 9601.3306
ZMW 27.369649
ZWL 343.468088
  • SLAC

    0.0050

    10.305

    +0.05%

  • CMSC

    0.0100

    23.9

    +0.04%

  • SCS

    0.1100

    11.94

    +0.92%

  • GSK

    0.4800

    39.75

    +1.21%

  • NGG

    -0.0600

    65.38

    -0.09%

  • AZN

    0.1900

    68.55

    +0.28%

  • RIO

    0.2900

    66.97

    +0.43%

  • RYCEF

    -0.0750

    4.885

    -1.54%

  • BTI

    0.2300

    29.05

    +0.79%

  • RBGPF

    0.1400

    51.75

    +0.27%

  • CMSD

    0.0900

    24.3

    +0.37%

  • BCC

    -1.0500

    133.6

    -0.79%

  • VOD

    0.0600

    8.34

    +0.72%

  • BP

    0.6000

    38.52

    +1.56%

  • BCE

    0.3800

    32.59

    +1.17%

  • JRI

    0.0400

    10.95

    +0.37%

  • RELX

    -0.3600

    41.07

    -0.88%

French public spending watchdog warns about post-Covid debt
French public spending watchdog warns about post-Covid debt

French public spending watchdog warns about post-Covid debt

France's public accounts watchdog warned Wednesday about the state of the country's finances, which have deteriorated dramatically in the last two years due to a massive Covid-19 rescue package, tax cuts and spending commitments.

Text size:

The influential Cour des comptes, which acts as a state auditor, forecast in its annual report that public debt would increase by 560 billion euros ($640 billion) between the end of 2019 and the end of 2022.

Most of the rise -- which will take total debt to an equivalent of 113 percent of GDP -- was down to Covid-19 after President Emmanuel Macron promised to spend "whatever it costs" to save the economy.

"This considerable effort will weigh long-term on the deficit and public debt, the reduction of which will require unprecedented efforts to control public spending," the watchdog said.

The rescue package and other state spending had left France with some of the most unbalanced public accounts among the 19 EU countries that use the euro, the Cour des comptes said.

According to its calculations, only Italy was worse off than France, which was in a similar position to Belgium and Spain.

France is "among the group of countries in the eurozone, two years after the start of the Covid-19 pandemic, where the public finances have deteriorated the most," it said.

- Debt 'volcano?' -

Even with strong economic growth of 7.0 percent last year and an estimated 4.0 percent in 2022, the watchdog warned that France risked running large and unsustainable deficits.

It forecast a deficit of 5.0 percent of GDP this year "of a completely structural nature" -- meaning that it was due to permanent over-spending, rather than one-off outlays linked to Covid-19.

The auditor cited "significant" tax cuts announced by Macron that would come into force in 2022, as well as extra spending commitments, including permanent additional funding for the health system.

The findings come at a highly sensitive moment as France gears up for presidential elections in April.

Macron, who is shown by polls as the front-runner, came into power in 2017 promising to balance France's accounts after decades of over-spending.

His first prime minister, Edouard Philippe, called the country's debt level "intolerable" in 2017, adding that "we are dancing on a volcano that is rumbling ever louder."

Macron is pushing for a permanent loosening of public spending rules for the eurozone that are meant to restrict states to running annual deficits below 3.0 percent of GDP.

After announcing massive public investments in strategic industries of the future under his so-called "France 2030" plan, he is seeking to persuade fellow members in the bloc to follow suit.

(Y.Berger--BBZ)