France faces a financial storm of historic proportions, as its public debt has soared to an unprecedented €3.4 trillion—roughly US$4 trillion—according to data released on September 25, 2025. This staggering figure now represents 115.6% of the nation’s gross domestic product, up from 113.9% just three months earlier. The dramatic rise, over €70 billion in a single quarter, has placed France firmly as the third-most indebted country in the European Union, trailing only Greece and Italy, as reported by INSEE and covered by multiple outlets including Bloomberg and Reuters.
This mounting debt crisis has landed squarely on the shoulders of France’s new prime minister, Sebastien Lecornu. At just 39 years old, Lecornu was appointed earlier this month by President Emmanuel Macron, replacing François Bayrou, who was ousted by parliament after his austerity budget was met with fierce resistance and ultimately rejected. Bayrou’s plan, which aimed to save €44 billion through deep spending cuts and the elimination of two public holidays, triggered widespread anger and massive protests, forcing his resignation after only nine months in office (Reuters).
Lecornu’s appointment comes at a volatile moment. He has yet to form a new government and must present a fresh budget proposal to parliament by mid-October. The stakes could hardly be higher. Unions have already announced another round of nationwide demonstrations set for October 2, following last week’s protests that saw hundreds of thousands take to the streets in defiance of Macron’s austerity drive (Reuters, Bloomberg).
“I am the weakest prime minister of the Fifth Republic,” Lecornu admitted, highlighting his vulnerable position. Without a majority in parliament, his ability to push through tough fiscal reforms is severely limited. The Socialist Party, a pivotal bloc in parliament, remains unconvinced by Lecornu’s overtures, especially as he appears unwilling to make significant concessions on taxation and social policy (Bloomberg). His reluctance to substantially increase taxes on the wealthy or alter social spending has complicated efforts to secure their support for the 2026 budget.
On September 24, Lecornu met with leaders of France’s main trade unions in hopes of easing tensions and building consensus. However, the outcome was far from conclusive. The unions, emboldened by recent protests and widespread public discontent, remain opposed to any measures that would reduce public services or increase costs for ordinary citizens. Many fear that the burden of deficit reduction will fall disproportionately on the working and middle classes, while the wealthy remain relatively untouched (Reuters, Bloomberg).
Economists warn that the numbers simply do not add up without new revenue streams—particularly taxes targeting higher earners. As one analyst noted, “Without some new taxes, especially on higher earners, the numbers simply won’t add up.” The challenge for Lecornu is to find a balanced approach that can satisfy parliament, the public, and the markets, all while avoiding the political collapse that felled his predecessor (Bloomberg).
The financial markets are watching closely. France’s credibility has already taken a hit: credit rating agencies have downgraded the country, forcing the government to pay more to borrow money. Rising interest payments risk trapping France in a vicious cycle, where more and more of the budget is spent servicing old debt rather than investing in growth or public services. This scenario, some experts warn, could lock France into years of stagnation, with little room to maneuver (Bloomberg).
President Macron has tried to put a brave face on the crisis. On September 24, he met with Wall Street leaders, including Blackrock CEO Larry Fink, on the sidelines of the United Nations General Assembly in New York. Macron promoted France as a land of economic safety, stability, and innovation, pointing to the success of startups like Mistral AI, which managed to secure major funding even as the government in Paris was collapsing (Bloomberg). The president’s message was clear: despite the political turmoil at home, France remains open for business and investment.
Yet, back in Paris, the reality is far more complicated. The political crisis has already claimed one prime minister, and Lecornu’s position is anything but secure. He has promised a “break from the past,” vowing to abolish life-long privileges for former prime ministers and to reconsider unpopular austerity measures like the scrapping of public holidays (Reuters). But with little progress in forming a stable government and no clear path to a majority in parliament, his ability to deliver on these promises remains uncertain.
Growth projections offer only modest comfort. The French economy is expected to grow by 0.8% in 2025, a slight improvement over earlier forecasts, but hardly enough to make a meaningful dent in the debt load (Bloomberg). Most analysts agree that a combination of controlled spending cuts and fair, targeted tax increases—especially on those who can afford to pay more—will be necessary to restore fiscal stability. However, with unions mobilized and the left skeptical, forging such a compromise will be no easy feat.
For Macron, the debt crisis has become a defining test of his presidency. Since taking office in 2017, he has cycled through seven prime ministers, each facing their own set of challenges. Now, with France’s finances under unprecedented strain and its political system in turmoil, the pressure is on both Macron and Lecornu to chart a course that avoids further unrest and restores confidence at home and abroad (Bloomberg, Reuters).
As the October 2 demonstrations loom and the deadline for a new budget approaches, all eyes are on Lecornu. Will he manage to unite a fractured parliament, appease an angry public, and satisfy the demands of international investors? Or will France’s debt crisis claim yet another political casualty? The coming weeks promise to be decisive for the future of the French economy—and for the fate of its embattled leaders.
With so much at stake, France stands at a crossroads, facing tough choices that will shape its economic and political landscape for years to come.
