After the crisis management, management of debt. This is the slogan that could take the major industrialized countries, which are out of recession emerge. In fact, according to the OECD, the 30 most advanced countries will see their debt rise to 100% of their wealth produced in 2010, signaling a near-doubling of their debt in twenty years. Japan's flirt with the 200% of its GDP, followed by those of Italy (127.3%) and Greece (111.8%).
The France is not there … Its debt will reach next year "only" 84% of GDP – a level already history. And since 2013 it has exceeded 90%. UMP Senator Jean-Pierre Fourcade, a member of the Finance Committee of the Senate, said Wednesday that France was now living in "perpetual debt"."The debt spiral is fueled by the fact that not only must pay the debt charges but that revenue for the year does not cover expenses," said Senator of Hauts-de-Seine. The debt burden is estimated for 2010 at 42.5 billion euros. His payment could become the first budget item in 2012.
In a report presented on Wednesday, Jean-Pierre Fourcade said that the evolution of the debt burden is explained not only by the stock of debt increases. but also by the rate of inflation: in 2008, the deviation from the prediction which had been established by the Government had created an additional cost of 2.5 billion, while it had resulted in savings of 2.8 billion in 2009.And finally the interest rate: Agency France Tr?sor has calculated that an increase of 0.25% rate of the European Central Bank in 2010 compared to what is expected (short-term rates to 1.3% and long-term rates to 3.9%) would increase the debt burden of 600 million euros.
Conference on deficits
The quality of the signing of France – which currently enjoys the maximum rating, AAA by the rating agencies – now enables it to fund the best conditions. "But maintaining its advantage is conditional on fiscal consolidation in the medium term," reaffirms the Senate, which considers "necessary to send signals to that effect to our partners and market actors" from 2011.
This was started to the Head of State, in announcing the holding of a conference on public deficits, and the Prime Minister, setting back to 2014 to below 3% deficit "price adjustments very important."
Beginning 2010, France will send to Brussels – which now requires a more ambitious timetable than Fran?ois Fillon – its multi-year plan of public finance. "It is a moment when we must take action just brutal," said the entourage of the Minister of Economy Christine Lagarde.
In regard to debt management, the report stresses that the funding program introduced in the draft budget law (the France would borrow 112 billion in 2010) "is obsolete even before being voted, given the absence of evidence on the future national debt. "He took the opportunity to recall that it "would be much less costly if it were agreed on markets rather than individuals and if it was issued at once," before the rise in interest rates. Focusing on "financial contributions from the state," the senators can only note that enterprises are "affected by the crisis."
The report stresses that the market situation "does not consider major privatization deals in 2010. The capital increase of the Post Office should make an exception. "There were no resources allocated to debt reduction in 2009, prospects for 2010 unfortunately does not consider a start in this direction next year," the senators concluded.
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