Posted 4/2/2024, 5:00:00 AM
Macron's Economic Reforms Fall Short, Raising Fears for France's Fiscal Future
- Macron's ambitious plan to transform France's economy and reduce deficits has failed, with France having the largest structural deficit in the developed world at 5.5% of GDP
- Reforms have been made, like trimming pensions and easing hiring, but growth remains low at 0.9% and debt very high at 110% of GDP
- France has borrowed heavily but has little real growth or means to pay back debt
- At some point, markets may lose confidence in France's fiscal sustainability, triggering a "Truss moment"
- This could be cataclysmic for the entire eurozone if France faces a financial crisis