Tribune. Who are France’s creditors? The question may seem trivial; it is not. It is almost impossible to answer this question today. Why is there no information in Parliament on this subject? Why do the ministers of Bercy, when asked the question, kick in touch? Public sector retirees have the right to know who pays their pensions. Our millions of public officials have the right to know by which foreign central banks their salaries are paid.
The French believe that the European Central Bank (ECB) is buying all the debt issued by France. They are wrong because, of the approximately 400 billion euros in public debt issued by France per year in 2020 and 2021, the ECB is only buying back about half. A very large part is lent to us by the rest of the world.
The latest figure published in September by Agence France Trésor is 49.5% of French negotiable public debt held by non-residents. But according to the Minister of Public Accounts, in an intervention in the hemicycle of the National Assembly on March 22, foreign investors “Still represent 65% of holders of French debt once this optical effect linked to the ECB’s monetary policy has been restated”.
If we are to believe the figures circulating in Bercy, around 250 to 300 billion euros of French debt would be held in China. Is this figure close to reality? Difficult to say, but that raises questions, knowing that the volume of securities held by non-residents is around 1,300 billion euros (half in the euro zone).
Beijing’s weapon
Of course, China also has more than $ 1 trillion in US public debt (a little less than 4% of US debt before the Covid-19 crisis), which makes some people say that this debt is a weapon in the hands of China to negotiate with the United States. What to say then for France? Do we still have the right to get angry with China? This is a real question. Even the most indebted countries, such as Japan or Italy, take great care not to internationalize their debts too much, with 14% for Japan and 30% for Italy in the last quarter of 2020. And the United States has only 24% of their public debt held outside their borders, still at the end of 2020.
France is currently sailing towards 3,000 billion euros in public debt. We will be at 2,950 billion euros in debt by the end of 2022. France’s financing and refinancing levels are likely to become more problematic from 2023, with around 180 billion euros of old debt maturing this year- the. At the same time, the ECB should gradually reduce the scope of its public debt buybacks. Frankfurt has already announced a “Slowdown” future of its asset repurchases.
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