Italy used to be the evil boy in Europe. Now, it’s France

With another vote of confidence next week, France now finds itself unfavorable compared to Italy, a country that was previously famous for political turmoil and economic weakness.

The continuation of the fighting between the main political parties in France and the arguments that were not resolved during the 2026 budget, in addition to a roundabout of failed prime ministers in the past two years, led economists to the question: “Is France Italy new?”

“The financial expectations of France are worse than Italy, at the present time,” European research analysts in Nomura said in a memorandum on Tuesday.

The Dion of France was 113 % of its gross domestic product in 2024, while Italy was 135 % – but the tables turned when it comes to the inability of countries during that period. On this scale, Italy’s deficit reached 3.4 % of its GDP (GDP), while France was 5.8 % of its gross domestic product.

French Prime Minister Francois Bayro last week called on confidence vote on September 8, seeking to pass the controversial 2026 budget that contains about 44 billion euros (51.3 billion dollars) in discounts. The aim is to reduce the France’s budget deficit to 4.6 % in 2026, a level that is still much higher than the rules of the European Union deficit.

Bayro put confidence voting next Monday as an existential alarm for France, and BFMTV was told on Wednesday that the situation was “dangerous and urgent.”

If he and his minor government do not win by voting, The government will collapse Less than a year after the collapse of the administration of his predecessor Michelle Barnier, and the other-fifth prime minister-the fifth in less than two years-will have to be selected by French President Emmanuel Macron.

The situation in France puts it in an improper situation compared to Italy, according to which it passed from the extended political turmoil and economic uncertainty before the election of the current Prime Minister Gijia Miloni in 2022, which led to stability in a period of stability For the three largest economies in the European Union.

France and Italy are subject to “excessive deficit procedures” of the European Commission – a mechanism that the committee uses to return the member states of the European Union with the financial rules of the bloc that should not be exceeded by public state debts 60 % of GDP, and the budget deficit should not exceed 3 % of GDP.

While Italy is expected to make progress in its inability under control, France does not show any signs of doing so, but Nomura has made it clear.

“The path of the French deficit is fragile, however, the potential overthrow of the Bayro government clarifies the challenge France faces in curbing its spending.”

Now, the neighbors of France are watching, as Bayro has only days to find a budget settlement with the competing parties on the left (the new front coalition) and the right (the national gathering) that feels, After the inconclusive elections last yearThey should be in power.

Both sides of the political spectrum indicated that they will not support the middle government in a vote on confidence on Monday after long arguments on the budget, proposed spending and tax height. The proposal to cut two public holidays in France It also decreased badly.

“Because of the expected fall of the Bayro government and the possibility of parliament not to pass the budget of 2026 this year, the budget of 2025 is likely to be frozen nomineively, which means that the deficit is marginally higher in 2026 as a percentage of GDP from the European Committee expected,” Nomura noticed that Debt Definability is. “

The possibility of another possible government collapse in France – and the constant dispute over the 2026 budget – is uncomfortable for analysts.

“France, which is already facing unprecedented pressure from the financial markets, will present a famous public scene next week,” MUJTABA RAHman, the administrative director of Europe at the Euroasia Group Group, commented in e -mail analysis on Tuesday.

The scenario of the basic cases of the Eurasia Group is that Bayro will lose confidence, a step that Rahman described as “a gamble that he could not win.”

“Macron has excluded new legislative elections-at the present time-and the fifth prime minister is appointed in 21 months, almost certainly from his center and the right-wing coalition of the center,” he pointed to the name of Defense Secretary Sebastian Lecorno, Minister of Justice Gerald Darmanin and Finance Minister Eric Lombard as possible alternatives.

It reflects the nerves of the broader financial market about the state of intense French policy, the return on France is 30 years old The bond returns rose above 4.5 % on Tuesday – as it reached another level seen in 2008 – before lightly reduced to 4.48 % on Wednesday. Other major economies were also suffering from high borrowing costs this week amid wider financial concerns.