Will France Need IMF help ? A Serious Warning

For the first time, the idea of France being placed under IMF guardianship has entered the halls of Bercy. Long reserved for countries in crisis, this prospect, now openly acknowledged at the highest level of the State, reveals the extent of the budgetary slippage. An abyssal debt, sharply rising interest charges, and pressure from rating agencies form an explosive cocktail. The signal is clear: French economic sovereignty is faltering, and international institutions are now scrutinizing Paris with the same severity as struggling economies.

France’s public debt : the figures worrying Bercy

While the interest on French debt is exploding in a tense economic context, the figures released by Bercy are enough to cause shivers.

According to data published in early June, France will have to allocate 67 billion euros in 2024 to pay only the interest on public debt, a historic record.

This sum is in addition to a total debt that now exceeds 3,300 billion euros, or 113 % of GDP. Such a level of indebtedness places France among the most vulnerable states in the eurozone.

It is in this climate that the Minister of Economy, Éric Lombard, has sounded an unusual alarm bell :

Our country is losing sovereignty, independence, and could find itself under the threat of a creditors’ and IMF guardianship.

Indeed, this statement, unusual in its gravity, marks a turning point in the official discourse surrounding France’s budgetary trajectory.

This shift is reinforced by a series of indicators that reflect the runaway public finances. The ministry anticipates a slippage that could reach 100 billion euros in deficit, a deterioration rate faster than estimated.

In this context, the debt burden threatens to become, as early as this year, the primary public spending item, ahead of the State’s core missions. Here is an overview of the budgetary comparisons presented by Bercy :

• 67 billion euros devoted to debt interest alone in 2024 ;
• 88 billion euros planned for the National Education budget ;
• 59 billion euros allocated to National Defense in 2025.

This simple inversion of budget hierarchy illustrates the gradual loss of control over the fundamental balances of public accounts, which fuels concerns among markets and rating agencies alike.

A downgraded rating and a negative scenario

The picture darkens further when observing the reaction of the rating agencies. On May 30, the agency Standard & Poor’s (S&P) confirmed France’s rating at AA−, equivalent to 16.5 out of 20, but maintained a negative outlook.

In financial language, this means that a future downgrade remains highly probable if no recovery measures are taken. Two other major agencies, Fitch and Moody’s, share a similar evaluation. This negative convergence is not merely symbolic. It increases the likelihood of a rise in interest rates on French debt, which would further worsen the budgetary spiral.

This new budgetary hierarchy, where the cost of debt would exceed this year the costs of Education (€88B) and Defense (€59B), represents an unprecedented reversal of State priorities.

Conversely, several countries in the BRICS show a more stable budgetary trajectory, with controlled debt levels and sustained growth contrasting with France’s structural imbalances.

The fact that merely repaying interest becomes the heart of public spending illustrates a gradual loss of control over essential economic levers. It is in this context that some economists fear France tipping into a form of market dependency, which could severely restrict its decision-making capacities.

While the hypothesis of resorting to the IMF may still seem extreme, the mere fact that it is publicly mentioned by a sitting minister represents a change of era. It is a strong political signal, intended perhaps as much to alert as to prepare minds.

The consequences of such guardianship would be considerable: loss of credibility in the markets, imposition of drastic reforms, and external monitoring of national budgetary choices. A scenario France has never experienced since World War II, which would place the Hexagon alongside countries like Greece or Argentina in the global financial imagination. However, can the State then requisition French savings to cover this public debt?