French public debt has crossed the 2900 billion euro mark for the first time.
In the first quarter, according to INSEE, the debt of all public administrations reached 2091.8 billion euros, up sharply over three months by 88.8 billion euros.
It therefore now represents 114.5% of tricolor GDP, a level also increasing compared to the end of last year, when it stood at 112.5% of GDP.
However, this level was already higher last year.
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The increase observed over the quarter is mainly due to the debt of the State and “
social security administrations
”, specify the national statisticians.
Conversely, local government debt stagnated and that of miscellaneous central government bodies fell slightly, a consequence, in particular, of SNCF Réseau's debt reduction.
At the local level, the municipalities and departments are also repaying their debts, while the regions are “
increasing their debt
”.
In the longer term, the increase since the start of the health crisis has been massive, reaching 526 billion euros between the end of 2019 and the start of 2022 for all public administrations.
The momentum observed at the end of 2019, with a slight decline in French bonds, was shattered by Covid-19, which caused the debt burden to jump from 97.4% to 117.4% of GDP at the beginning of 2021. The current level is certainly lower, but it remains well above the pre-crisis level.
France is therefore approaching the level never before reached of 3000 billion in debt, but the government ensures that it retains control of the finances.
If the executive was counting on ambitious reforms - including pensions - on "
full employment
" and on growth to put the accounts back on track, the war in Ukraine, inflation and, more recently, elections legislative changes have complicated this equation.
During the legislative campaign, the oppositions thus accused Emmanuel Macron of secretly wanting to increase the VAT to relieve the portfolio of the State, an attack vigorously denied by Bercy and which has not been supported by evidence, so far.
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Still, France is far from being the only country facing an explosion in its debt.
In May, the European Commission took note of the difficult situation facing States, proposing to extend the suspension of budgetary rules in 2023. The obligation to keep debt below 60% of GDP seems a long way off: end 2021, according to Eurostat, the average level of the 27 thus stood at 88.1%.
For the time being, the IMF predicted, in April, a stabilization at 112% this year, then a slight increase between 113% and 114% until 2027. For its part, the Banque de France is counting on a stabilizing public debt to 112% of GDP this year, before a slight drop to 109% until 2024. Falling back below 100%, within a few years, will be necessary to give France some leeway, in the event of crisis, recently warned in our columns the governor of the institution, François Villeroy de Galhau.
A warning that is all the more important as the rise in interest rates, which increase the cost of debt, has begun, while France must make significant investments in the years to come, particularly in the sector of energy.
