France seeks extension for public deficit reduction plan deadline

The French government has formally requested from the European Commission an extension for the deadline to submit its plan for reducing the public deficit, which is currently set for September 20.

The Finance Ministry cited the need to ensure alignment between the deficit reduction plan and the upcoming 2025 finance bill as the reason for the extension request. The new deadline proposed by France has not been specified.

This development comes amid significant political changes in France. On September 5, President Emmanuel Macron appointed Michel Barnier as the new prime minister, following Bruno Le Maire’s announcement that he would step down from the finance minister position.

Barnier faces the task of assembling a new cabinet and submitting the national budget by October 1.

Additionally, Barnier’s position is complicated by his lack of a parliamentary majority, with the National Assembly presenting a mixed response.

Many lawmakers are either outright hostile or demanding policy concessions, potentially putting Barnier’s government at risk of a no-confidence vote.

The European Union has been pressing France for a comprehensive long-term fiscal strategy, making the timely submission of this plan crucial.

Attribution: Bloomberg

Subediting: M. S. Salama