French Business Leaders Warn Political Instability is Harming the Economy Amid Calls for Responsible Governance
French business leaders and former officials warn that political instability is jeopardizing economic growth and urge the government to adopt credible budgets and postpone contentious reforms.
- • Samuel Hervé warns political instability is damaging economic confidence and business investment.
- • Record business failures in France reached 66,420 in 2024 with projections of 70,000 in 2025.
- • Calls for a 2026 budget focusing on spending reduction, no tax hikes on businesses, and support for education and local authorities.
- • Former Economy Minister Éric Lombard suggests postponing pension reform until after 2027 elections due to political climate.
Key details
Amid ongoing political uncertainty surrounding the Lecornu II government and rumors of a censure vote, French business leaders and former officials have expressed deep concerns over the country’s economic outlook. Samuel Hervé, president of Medef Occitanie, criticised the current political instability for undermining trust and economic confidence at a critical time. He highlighted the grave economic indicators, including a record 66,420 business failures in 2024 and projections rising to 70,000 in 2025, alongside a sharp decline of 69,000 apprenticeship contracts this year, warning that companies simply cannot afford stagnation unlike politicians. Hervé urged political leaders to present a credible 2026 budget focused on reducing public spending, avoiding tax hikes on enterprises, prioritising education and training, and providing clearer guidance to local authorities to help sustain regional investments and employment.
Meanwhile, former Economy Minister Éric Lombard advised putting the controversial pension reform "on ice" until after the 2027 elections, reflecting tensions around reform timing amidst the volatile political scene. Other figures, such as Sterimed CEO Thibaut Hyvernat, lamented a "lack of visibility" for businesses caught in the political turbulence, while Jean-Louis Borloo called for political clarity and seriousness over maneuvering, likening the current moment to a transformative "Perestroika."
These voices collectively paint a picture of a French economy at risk, struggling against the headwinds of political upheaval, which threatens investment, job security, and overall economic stability. Hervé’s call to "stop playing with the economy" encapsulates the urgency for coherent and responsible governance to restore confidence and protect business and employment across France.
The government faces a critical choice in the coming week as it navigates both economic challenges and political survival, with firm budgetary discipline and reform management likely key to stabilizing the situation.