Congratulations and recommendations, in particular to control public spending and reduce debt. This is the health bulletin issued, Thursday, November 18, by the Organization for Economic Cooperation and Development (OECD) on the situation in France, which should experience, according to its assessments, stronger growth than expected in 2021, around 6.8%, instead of 6.3%. In 2022, the gross domestic product (GDP) could grow by 4.2%, not 4%, as envisaged in September.
For 2021, the organization is therefore more optimistic than INSEE and Bercy, which expect growth of 6.25%. On the other hand, it is on the same wavelength as the Banque de France, for which it could reach 6.75% over the year.
After the historic 8% recession in 2020, this strong recovery was made possible by “The economic policies which reacted quickly and massively to the crisis”, indicates the note. “Public support during the crisis [liée au Covid-19] was impressive and very efficient ”, OECD Secretary General Mathias Cormann admitted during a press conference with Minister of the Economy Bruno Le Maire. Such ” impressive ” – and this is where the finding takes another turn – that it has led to a sharp increase in the public deficit and the public debt, recalls the OECD, which is worried about it.
At 115.2% of GDP in 2020 and 2021, French public debt stands at a level “Historically high” ; the budget deficit represents 8% of GDP and the public expenditure rate is now “The highest in the OECD”, according to calculations provided by the organization. A finding all the more worrying, according to the institution, that “The expenditure structure [publiques] is not investment-oriented enough ”. In fact, pensions constitute the first item of public expenditure, before salaries, health and education expenditure, with investment occupying only fifth place. “It is urgent to ensure the efficiency of public spending”, Mr Cormann launched to Mr Le Maire.
“The French people are determined to repay their debt”
Not without observing that the OECD “Valid” the economic policy choices made during this crisis and that it is “Much more optimistic” that the executive on growth prospects, the tenant of Bercy joined Mathias Cormann’s position on the issue of public finances. After doing the “Strategic choice” of “ spend public money to protect employees and businesses rather than repairing afterwards ”, France “ must enter a new phase where it will be necessary resolutely and gradually to restore French public spending ”, he insisted. The return to growth, the reforms undertaken (in particular that of unemployment insurance) as well as, on a more technical level, the adoption of a multiannual rule for the evolution of public spending, such as the one voted in by Parliament Thursday, November 18, should make it possible to achieve this.
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