French President Emmanuel Macron has publicly acknowledged that his decision to call snap parliamentary elections last year has led to greater instability in France’s political and economic landscape. Speaking during his televised New Year’s address from the Elysee Palace on December 31, Macron admitted that his move to dissolve parliament and hold early elections in the summer of 2024 brought “more divisions to the Assembly than solutions for the French.”
A Political Gamble Gone Wrong
In his address, Macron explained his reasoning behind the snap elections, stating that the decision was made to “give [the French people] back the floor” and avoid governmental stagnation. However, he conceded that the results have been counterproductive, leading to months of political deadlock and heightened divisions within the National Assembly.
“I must admit tonight that the dissolution [of parliament] has brought, for the moment, more divisions to the Assembly than solutions for the French,” Macron said. “Lucidity and humility demand that we recognize that at this time, this decision has produced more instability than serenity, and I take full responsibility for that.”
The snap elections failed to produce a decisive majority, leaving Macron’s centrist coalition unable to effectively govern. The far-left and far-right parties emerged emboldened, leading to a short-lived conservative-centrist government that collapsed in December 2024 after losing a confidence vote over the 2025 budget.
France’s Economic Challenges
The political turbulence has compounded France’s economic woes. The country is grappling with a budget deficit projected to reach 6.1% of GDP in 2024 and a debt level of 112% of GDP—both figures exceeding the European Union’s fiscal rules. Credit ratings agency Moody’s downgraded France’s credit rating last month, citing political fragmentation and weak public finances.
France’s economy is expected to suffer as a result. The Bank of France recently downgraded the nation’s growth forecast for 2025 to 0.9%, down from 1.2%, while economists warn of the possibility of stagnation or even recession. Charlotte de Montpellier, senior economist at ING, described the situation as a “difficult winter” ahead for the French economy, with risks skewed to the downside.
New Government, Old Problems
In December, the National Assembly approved a temporary budget law to roll over 2024 provisions into 2025. However, the new minority government, led by Prime Minister Francois Bayrou, faces an uphill battle in addressing France’s fiscal challenges and bridging political divides. Bayrou has characterized the task as a “Himalaya” of challenges, including tackling the deficit and preventing further political instability.
Economic analysts remain skeptical about the government’s ability to enact meaningful reforms. According to Andre Sapir, a senior fellow at the Brussels-based think tank Bruegel, the new government may last longer than its predecessor but is unlikely to achieve significant progress. “France is not governable,” Sapir said, adding that political parties are more focused on positioning themselves for the next presidential election than solving the country’s pressing issues.
The Road Ahead
With the next presidential election scheduled for 2027, tensions are already running high among France’s political factions. Both far-left leader Jean-Luc Melenchon and far-right figurehead Marine Le Pen are pushing for an early presidential election, seeing 2025 as an ideal opportunity to capitalize on Macron’s weakened position. However, other political groups are reluctant to risk either Melenchon or Le Pen gaining power, creating a stalemate over whether an early election would be in anyone’s interest.
For now, Macron has ruled out early presidential elections and is focusing on stabilizing the government. Still, the uncertainty surrounding France’s political and economic future remains a cause for concern across the European Union. Political fragmentation, a struggling economy, and rising public discontent suggest that 2025 will be another turbulent year for the eurozone’s second-largest economy.
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