French Prime Minister Michel Barnier (C) prepares for his general policy statement at the French National Assembly in Paris on October 1, 2024. Mr Barnier, a right-wing former Brexit negotiator, was appointed by the French president three weeks ago to bring stability after the political turmoil caused by a hung parliament in the wake of this summer’s snap elections.
Alain Jocard | AFP | Getty Images
French lawmakers are scheduled to debate and vote on Wednesday on a no-confidence motion filed against Michel Barnier’s fragile government.
The parliament said in a social media post that the motion, submitted by the opposition Left Bloc and the far-right National Rally, would be debated at around 4 p.m.
If either bill is approved by Parliament, the government must resign.
This comes after French Prime Minister Barnier opted on Monday to use special constitutional powers to force a vote on a hotly debated budget without parliamentary approval. It is.
There are wide expectations that the left and right can work together to topple the current centre-right government.
Holger Schmieding, Berenberg’s chief economist, said last week that Mr. Barnier is at the mercy of Marine Le Pen’s right-wing National Rally (National Rally), which is working with the United Left to defeat Mr. Barnier with a no-confidence vote. “There is a possibility,” he warned.
Attempts to reach a compromise over a budget that would include 60 billion euros ($63.16 billion) in tax increases and spending cuts to reduce France’s deficit stalled over the weekend.
If the government falls, it is unclear what will happen next. New parliamentary elections cannot be held until June next year, 12 months after the last round of voting called by French President Emmanuel Macron this year.
Mr Macron will also need to appoint a new prime minister, a politically charged task given the divided nature of the current parliament.
After Wednesday’s vote was finalized, France’s CAC40 index rose 0.57% and the euro rose 0.3% against the US dollar. French government bond yields were little changed.
Still, economists say the impending political unrest could spell bad news for French assets, with uncertainty pushing France’s borrowing costs already higher than Germany’s to a 12-year high. reached the same level as Greece.
-CNBC’s Holly Ellyatt contributed to this article.
