The heavyweights of the majority recognize it themselves: it is impossible to bury your head in the sand any longer. The macroeconomic forecasts on which the government built its budget for 2024, and bases some of its political objectives such as full employment in 2027, are obsolete. One after the other, major international organizations publish figures much lower than those of Bercy, with a consensus around 0.8% growth this year, compared to 1.4% in the Ministry of the Economy’s scenario.
Latest: the Organization for Economic Cooperation and Development (OECD), which announced Monday February 5, counting on growth of 0.6% of GDP in 2024 for France. The organization, otherwise relatively optimistic about global growth, revised its figures downward. INSEE also indicated on Tuesday January 30 that the “ fairly noticeable slowdown » of 2023 would weigh on 2024, through the voice of its general director, Jean-Luc Tavernier. The latter admitted on France Inter that the figure of 1.4% would undoubtedly be difficult to achieve.
The impact of a slowdown in growth on public finances is almost immediate. On average, one point less growth compared to forecasts weighs down the deficit by 0.5 points, the rate of compulsory deductions being, in France, close to 50% of GDP. But the impact is also political. A marker of Emmanuel Macron since 2017, supply-side policy is based on the idea that tax cuts and business-friendly measures stimulate growth and therefore job creation.
It is also growth which must, in the government’s software, make it possible to repay the debt and reduce the deficit through additional wealth creation, while avoiding increasing taxes. Any slowdown in growth is therefore likely to compromise objectives such as full employment, which is highly correlated with the evolution of GDP, or the reduction of the public deficit. France has committed to Brussels to reduce its public deficit below 3% in 2027. The deficit is currently expected to be 4.9% in 2023 and 4.4% in 2024.
A truth operation postponed
The Minister of the Economy Bruno Le Maire has so far always confirmed his forecasts, castigating the Cassandras denied by the facts. In 2023, growth was in fact close to his ministry’s expectations, at 0.9% compared to 1% for Bercy’s forecasts. The number two in the government should nevertheless quickly update the figures for 2024, once the government reshuffle has passed, and the position of Minister for Public Accounts has been filled again. The fact remains that the moment is politically unpleasant, both for the new Prime Minister, Gabriel Attal, and for the Head of State, who are reluctant to accept this truth operation. “ We can’t wait too long if we’re out of syncwe admit at Bercy. We have always been quite transparent about the figures. »
You have 45% of this article left to read. The rest is reserved for subscribers.