Overthrow of the government in France
Macron under pressure in political crisis – EU looks to Paris
Updated on December 5, 2024 – 4:34 p.mReading time: 4 minutes
After the fall of the government, pressure on French President Macron is growing. Creating clear conditions quickly is not just in his interest. The EU is also concerned about the situation in Paris.
The serious political crisis in Paris is not only putting President Emmanuel Macron under increasing pressure, but is also alarming the EU in Brussels. In the morning, Macron received Prime Minister Michel Barnier, who resigned after just three months after the fall of his center-right cabinet as the head of government with the shortest term in recent French history. However, he will remain in office as manager for the time being.
The populist forces on the left and right fringes of parliament, which brought down Barnier on Wednesday evening in a dispute over an austerity budget, are now targeting Macron and are talking about his resignation and an early presidential election. In the evening, the President wants to give an address to the nation – that should provide information about what happens next. He had always ruled out resigning.
It’s not just the opposition that accuses Macron of having triggered, or at least worsened, the political crisis in France with unclear majorities in parliament with early elections last summer. Macron is now under increased pressure from within his own ranks to appoint a new head of government as quickly as possible who will unite the divided camps in parliament so that the long overdue budget can be passed and important projects can be initiated.
Meanwhile, the right-wing nationalist Marine Le Pen and the old leftist Jean-Luc Mélenchon are being accused by the government camp of fanning the political crisis in France. Their aim is to bring Macron down early so that they can then run in an early presidential election. Macron cannot run again after two terms in office.
According to media reports, Macron is keen to appoint a new prime minister as quickly as possible. This could help him strengthen his fragile position, save his remaining term until 2027 and dampen calls for his resignation.
The faster a new government starts work, the faster the French budget crisis could consolidate and there could be reassuring signals towards the economy and financial markets.
Macron was already holding talks from midday to explore who could be considered as the future prime minister. It’s not just the candidate’s profile that has to fit.
Given the difficult balance of power in parliament, in which neither the left-wing alliance nor Macron’s camp nor the right-wing nationalists have a majority, the future prime minister must have a connection to all blocs in parliament if possible. Names are already circulating, without any obvious favorites initially emerging.
The public debt burden in France has become increasingly out of control and the EU Commission is conducting excessive deficit proceedings against France because of excessive new debt. The austerity budget that collapsed Barnier’s government is a bitter necessity.
This year, France expects a budget deficit of 6.1 percent, which is far away from the European limit of three percent.
Given the political impasse in France, the confidence of domestic and foreign companies has been disrupted. Investments are being delayed and the business location is in danger of being damaged.
The industrialized nations organization OECD warned that without a budget agreement, the expected economic growth would be at risk and tax revenue would be reduced. Barnier warned that political instability would mean higher risk premiums on government loans and additional billions in costs for the country.
