French PM seeks mass support to fight 'crushing' debt

Prime Minister Jean-Marc Ayrault on Tuesday urged the French to rally behind efforts to tackle a "crushing" debt burden after an audit warned of a 43-billion-euro budget hole.

He was speaking before his leftist government won a vote of confidence later in the day in the National Assembly.

Ayrault, outlining the new Socialist government's agenda in parliament, also admitted the crisis was "unprecedented" and said debt servicing charges had become untenable.

In Europe, the eurozone crisis still burns and at home his finance minister has just warned that French economic growth will be lower than forecast.

"The debt burden has become crushing. The state pays nearly 50 billion euros ($63 billion) to its creditors annually," Ayrault said.

"I have come here today to appeal to you and, through you, all French people for a mobilisation because it is not too late to react and succeed," he said, appealing for "patriotism," and adding: "An indebted France is a dependent France."

Ayrault said the aim of the belt-tightening was to have a balanced budget in 2017 as he squarely blamed the economic mess on the previous centre-right government of president Nicolas Sarkozy.

Ayrault said that between 2007 and 2011, France's debt grew by 600 billion euros "to nearly 1,800 billion euros today, or 90 percent of the wealth produced annually in France."

The prime minister of President Francois Hollande -- whose electoral mantra has been growth over austerity and who famously said he does not "like the rich" -- sought to strike a conciliatory tone, stressing he was "not an enemy of wealth."

The projected two-year shortfall of up to 43 billion euros by the state auditor is what has to be covered with spending cuts and tax increases to reduce the overall public deficit by stages to targets for this year and next.

Ayrault's speech was being closely watched by voters, businesses and the right-wing opposition but also by financial markets worldwide as France along with Germany is a key player in resolving the eurozone debt crisis.

Its big public debt also means France could become a target for bond market speculation if the eurozone's latest emergency measures do not calm things down.

The prime minister revised growth forecasts for this year to 0.3 percent from 0.5 percent and for next year to 1.2 percent from 1.7 percent.

During his election campaign, Hollande pledged to reduce public debt, the accumulation of past deficits, based on the earlier, more optimistic, forecasts. France has run budget deficits since the 1970s.

France has promised its European Union partners it will reduce the public deficit from 5.2 percent of output in 2011 to 4.5 percent at the end of this year.

Hollande had pledged to create new jobs, impose a 75-percent tax on income of more than one million euros and has already committed the government to raising the minimum wage by 2.0 percent.

The audit office said that for 2013, on the basis of a commitment of reducing the deficit to the EU ceiling of 3.0 percent of gross domestic product, widely-based taxes such as VAT sales tax or the complementary social CSG tax, would have to be raised, at least temporarily.

In the evening, the government under Ayrault won a vote of confidence.

Out of the 527 votes cast in the 544-seat assembly, 302 were for and 225 against the new government, said the legislature's president Claude Bartolone.

Deputies of the Socialists, ecologist EELV and radical left voted for the government while the Left Front abstained. The Conservative UMP and the UDI or Union of Democrats and Independents voted against.

In a brief speech, Ayrault thanked MPs for "trusting the government".

"The government can't move forward if it does not have the confidence of the majority: you have clearly expressed it," he said. "Now we have our roadmap and together we will succeed."


Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • US renews travel warning to Mindanao
    US renews travel warning to Mindanao

    The US State Department renewed its warning about the risks of travel to the Philippines, in particular to the Sulu archipelago, certain regions and cities of Mindanao and the southern Sulu Sea area. In an update on Wednesday of a travel warning it issued Nov. 20, 2014, the State Department said US citizens should continue to defer non-essential travel to the Sulu archipelago due to the high threat of kidnapping of international travelers and violence linked to insurgency and terrorism there. …

  • Phl gains support for APEC Action Agenda
    Phl gains support for APEC Action Agenda

    The Philippine initiative to put the interests of micro, small and medium enterprises (MSMEs) front and center in global and regional trade has made significant progress following the conclusion on Thursday of the 2nd APEC Senior Officials’ Meeting (SOM2) and Related Meetings in Boracay, Aklan. Called “The Boracay Action Agenda to Globalize MSMEs,” the Philippine proposal calls for a host of specific, concrete and practical interventions that APEC economies can implement to provide MSMEs wider …

  • Phl to join Bangkok meet on Rohingya crisis next week
    Phl to join Bangkok meet on Rohingya crisis next week

    The Philippines will join a 15-nation meeting in Bangkok, Thailand next week to address the migration crisis involving thousands of Rohingyas who escaped persecution in Myanmar and Bangladesh. Justice Secretary Leila de Lima bared this yesterday after meeting with United Nations High Commission for Refugees (UNHCR) representative to the Philippines Bernard Kerblat. In an interview, De Lima said the Philippine government has been invited to the meeting. …

  • Magnitude 4.2 quake jolts Sorsogon
    Magnitude 4.2 quake jolts Sorsogon

    LEGAZPI CITY—A magnitude 4.2 earthquake hit Prieto Diaz town in Sorsogon before dawn yesterday, the Philippine Institute of Volcanology and Seismology (Phivolcs) said. …

  • Drought-resistant rice breeds bared
    Drought-resistant rice breeds bared

    SCIENCE CITY OF MUÑOZ, Nueva Ecija – Amid the searing heat, the Philippine Rice Research Institute central experiment station here has identified nine rice breeds which have been proven to be drought-resistant and produce high yields in temperatures as high as 38°C based on a recent study. Thelma Padolina, lead researcher of the study titled “Screening of rice-induced mutants for heat and drought tolerance,” identified the breeding lines as the Ballatinaw lines, PSB Rc72H and Azucena lines. …

  • Phl, US assert rights, ignore China warning
    Phl, US assert rights, ignore China warning

    The United States military will continue air and sea patrols in international waters even after the Chinese navy repeatedly warned a US surveillance plane to leave the airspace over artificial islands China is creating in the disputed South China Sea. The Philippine government also declared it would continue activities in the region, calling on China to respect freedom of navigation and aviation. “Our position on the importance of letting freedom of navigation, freedom of aviation and …

  • MM shutdown eyed for quake drill; 6 schools warned
    MM shutdown eyed for quake drill; 6 schools warned

    Electricity and mobile phone services would be cut throughout Metro Manila, and all private and government offices and businesses, including shopping malls, would be closed. That would be the situation on July 16 between 3 and 8 p.m. to simulate the scenario of a 7.2 magnitude earthquake. The Philippine Institute of Volcanology and Seismology (Phivolcs) has warned that an earthquake of that magnitude could occur and kill at least 33,500 people and injure at least 113,600 others following a …

  • Subaru XV now priced among sedans
    Subaru XV now priced among sedans

    Motor Image Philipinas (MIP), the authorized distributor of Subaru in the country, has positioned its brand new crossover SUV, the Subaru XV, well within the sedan segment’s price range. This move, according to MIP, was made to give the public an opportunity to experience the brand’s unique automotive technologies by lowering its price. Buyers of […] The post Subaru XV now priced among sedans appeared first on Carmudi Philippines. …


Should Aquino be held accountable over the Mamasapano operations?

Poll Choice Options