Centrist politician Francois Bayrou has been announced as France’s new prime minister.
On Dec. 5, French lawmakers from all sides of the political spectrum voted to remove conservative Michel Barnier from the powerful post, signaling deepening divisions within the French parliament.
On Friday, President Emmanuel Macron named François Bayrou - a French centrist and a longstanding ally - to the role of prime minister.
As Owen Evans reports via The Epoch Times, Macron has vowed to remain in the Elysee Palace for the duration of his term, which runs until mid-2027.
Before then, he cannot be ousted by Parliament, although opposition on both his left and right flanks are already calling for his resignation.
Macron is being pulled in multiple directions, caught between a left-wing coalition that includes his own party, La France Insoumise, the Socialist Party, the Ecologists, and the French Communist Party, and the right-wing National Rally.
Bayrou will have to navigate the uncertainty around the deeply divided parliament has also made it increasingly difficult for the government to pass the 2025 budget.
The country’s debt is projected to soar to above 3 trillion euros ($3.17 trillion) by 2025, with public debt hovering at around 110 percent of GDP.
Despite the uncertainty, the euro is rallying on the news...
Parliament will likely approve a Special Law before the end of the year to roll over the 2024 budget. This is consistent with a meaningful amount of austerity mainly focused on departmental spending restraint. However, the deficit will remain very wide.
Centrist parties might agree on a “non-aggression” pact to prevent the next government from collapsing, but the need for substantial fiscal consolidation will continue to make the approval of a budget for 2025 challenging.
Bayrou is a long-time centrist politician known for his negotiation skills. Macron wants him to reach an agreement with centrist parties, so they at least refrain from filing no-confidence motions against the new government.
The center-left Socialist Party (PS) and the center-right Republican Right (DR) do not want to be associated with each other or with Macron.
However, they both have an incentive to differentiate themselves from LFI and RN by portraying those parties as irresponsible for creating political instability. Therefore, they might potentially acquiesce to some sort of non-aggression pact.
The biggest risk for political centrism is that parties such as Marine Le Pen’s far-right National Rally (RN) or Jean-Luc Melanchon's France Unbowed (LFI) might benefit electorally by blaming the centrists for the country’s potentially poor economic performance.
The bottom line is that France now has a new prime minister, and the government to be formed in the coming days might be more stable than the last.
But the divisions that have paralyzed the budget process remain and a break in the political logjam looks a long way off.
All this will probably weigh on an economy that is already losing momentum.
