00:00Hello, it's Mark Oswald, Chief Economist at Investment Brokerage, ADMIS.
00:04Good to see you there, Mark.
00:05So, investors in French government debt seem really spooked.
00:10What would it take to get them buying French bonds again?
00:16I think it's going to take actually quite a lot now,
00:20because no one really has any solutions to some of these deep-seated problems
00:28about the cost of living, the cuts to education spending.
00:33No one in the political sphere in France wants to countenance.
00:39The very measure that Mr. Macron basically created,
00:44he tried to reform pensions in France,
00:47because the system that they've got in France is simply unfinanceable in the long run,
00:53and it's not even a question in the long run.
00:56It's becoming much more acute now.
00:59It's in the short run.
01:00And until someone actually starts dealing with that credibly,
01:05and I wouldn't say that there are any candidates for next year's presidential election
01:10who really seem to have any ideas on that,
01:13then the problems are just going to get worse.
01:15Inequality is a problem across the whole of the Western world,
01:19but in France it seems to be a particular agreement
01:23which people are more willing to protest about than, say, in some other countries.
01:28We saw plenty of protests along a similar vein in Portugal, Italy, Belgium this weekend.
01:35Well, you're mentioning all of those big European economies.
01:38Are we on the brink of a repeat of the Eurozone debt crisis 15 years ago,
01:42or is France a very different story?
01:47I think France is quite a unique story.
01:50I mean, it's tragic, actually, that since the 2024 snap election,
01:56actually there has been no effort, really,
02:00to look at what sort of consolidation of the budget measures there could be.
02:05There's been no efforts at finding a cross-party solution.
02:09All it's been a case of is the French political sphere,
02:14basically just focusing on the 2027 election.
02:18And if I use bad words, the budget be damned.
02:24But it doesn't solve the problem next year or this year.
02:29So does France have to muddle through until the 2027 presidential election
02:34before the markets can find some sort of stability?
02:40It certainly seems that way.
02:42It doesn't seem, you know, one would imagine any of the measures
02:46which they need to take to save the 61 billion
02:50to start bringing down the deficit and stop it ballooning further
02:55are probably just going to not find the support.
02:59At some point, though, someone has to get a grip with this,
03:03and the cost one would have to add of all the repairs after this weekend's riots.
03:09And more importantly, France is the world's largest tourist destination
03:14with 102 million tourists a year.
03:16I can't imagine that a lot of tourists who are planning to visit in France
03:21during the autumn and winter are probably looking on this that favorably.
03:25So that's going to be a huge hit.
03:27Well, thank you for your insight, Mark Osval.
03:29Always a pleasure.
