Antoine Armand, a 33-year-old ally of President Emmanuel Macron, was named France’s new finance minister over the weekend. On Monday, the country’s 10-year bond yield was just 1-1/2 basis points away from surpassing that of Spain’s traditionally more risky paper for the first time since late 2007.
“I understand these questions,” Armand told France Inter radio, adding: “When you’ve had government experience, you have a certain number of habits. When you haven’t got that, yes it’s new, yes it’s quite a thing.”
Teaming up with new Budget Minister Laurent Saint Martin, who is 39, Armand has the daunting task of plugging a huge hole in the budget. Previously little-known beyond Parisian political circles, the duo face pressure to figure out how to rein in France’s budget deficit as it spirals towards 6% of GDP.
“We have one of the worst deficits in our history, so the situation is serious”, Armand said. “Our hard work will match the seriousness of this situation.”
Asked whether the country will meet its budget deficit projection this year, Armand declined to give a clear answer, saying he was working with the budget minister on a “credible” updated estimate to be presented soon.
France’s chief auditor last week told lawmakers the finance ministry’s current forecast of a deficit at 5.1% of GDP was out of reach due to reduced tax incomes amid an economic slowdown and lower public sector savings than needed.
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