France's Fiscal Resurrection: Bayrou's Bold Plan

French Prime Minister Francois Bayrou has unveiled a comprehensive strategy to stabilize France's public finances, proposing measures such as cutting two bank holidays and reducing budget deficits by 2026. The plan aims to curb spending, enhance industrial growth, and innovate in key sectors like AI and cybersecurity.

In a sweeping move to restore fiscal stability, French Prime Minister Francois Bayrou on Tuesday outlined a 43.8-billion-euro deficit reduction plan aimed at steadying the country's public finances by 2026. Central to this strategy is the controversial proposal to eliminate two bank holidays as a means to boost economic growth.

France has been grappling with a budget deficit that soared to 5.8% of GDP last year, nearly double the EU's allowable limit. Bayrou, facing resistance from a fractured parliament, emphasized the urgency of reducing reliance on public funds to avert potential credit downgrades and higher interest rates.

The comprehensive plan includes a freeze on state spending, civil service job cuts, reforms in health spending, and initiatives to increase productivity and industrial competitiveness, with a focus on future-facing sectors such as artificial intelligence and cybersecurity.

(With inputs from agencies.)