Le Pen vows drastic cost savings to prevent French 'default' / Photo: © AFP
Le Pen vows drastic cost savings to prevent French 'default'
French far-right presidential candidate Marine Le Pen said Tuesday that she would implement 140 billion euros ($157 billion) in cost savings by 2032 if elected next year, warning that without change France was "heading towards default" on its debt.
The current frontrunner in the presidential race made the announcement in a bid to stake out her credibility on the economy and regain momentum after her top ally Jordan Bardella was accused of making antisemitic comments, which he has denied.
Le Pen also vowed to bring France's public deficit back to below the EU limit of three percent of GDP by 2030, while urging the European Central Bank to "ease the burden" of interest rates.
France's deficit -- the annual shortfall of revenue to spending -- came in at 5.1 percent of GDP last year, and instead of reducing that level as originally planned the government now forecasts it will hit 5.4 percent this year.
It plans to borrow 340 billion euros ($385 billion) in 2027, around 28 billion euros more than this year, to help finance government spending and repay debt coming due.
But those forecasts could be jeopardised by rising interest rates, which have seen France's government bond yields soar in recent weeks.
"If the French do not choose a political break, France is heading towards default," Le Pen said.
She slammed the successive governments of President Emmanuel Macron for failing "to anticipate the slightest economic, financial or budgetary policy capable of preventing the noose of interest payments from strangling France".
Le Pen also lamented that "productivity has completely fallen behind that of the United States, and our research spending is incapable of giving us the slightest comparative advantage in the technological battle that is raging".
She also reaffirmed her proposal to introduce via referendum a budget "golden rule" to oblige an annual reduction in debt.
But Le Pen will have to find areas to make significant cost savings, given she also wants to lower the retirement age to 62, or even 60.
She promised cost savings of 15-20 billion euros within pensions alone by correcting "inefficient and unfair" measures in the current system.
A poll last week showed Le Pen was on course to easily win not just the first round of the presidential elections next April, but also the second round against any challenger.
But the accusations last week that Bardella made antisemitic comments on Facebook messenger in 2013 dealt a blow to her campaign. She has made clear she still has full confidence in Bardella.
T.Cunningham--TNT
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