French public debt to reach new record level in 2027, exceeding 120% of GDP
The government submitted its draft budget bill to the High Council of Public Finances on Friday. The bill provides for new tax increases, which are set to be the main factor in reducing the budget deficit. The public debt, meanwhile, will continue to rise.
France's debt is projected to soar to a record high of 119.3% of economic output in 2026, with a potential debt-to-GDP ratio of 121.7% in the following year, according to the country's finance ministry. This projection comes from a statement made to the High Council of Public Finances, an institution responsible for assessing the government's revenue and spending forecasts.
In 2025, France's debt-to-GDP ratio stood at 115.7%, marking a significant increase from the below-100% levels seen in 2019. The ministry also anticipates a budget deficit of 5.4% by the end of the year. Prime Minister Sebastien Lecornu has expressed confidence that the 2026 deficit will be well below 5.5%, but he is facing the challenging task of implementing a €54 billion ($62 billion) savings plan in his 2027 budget to prevent the deficit from spiraling out of control.
The cost of borrowing for France has risen to more than a full percentage point above Germany's rates, a first since the eurozone debt crisis. This has highlighted growing concerns among investors about the deterioration of France's financial situation ahead of upcoming elections.
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