Surprise: the economic crisis is slightly less severe than expected. In an interview with our colleagues from Les Échos, the Minister of the Economy, Bruno Le Maire, and his Minister for the Budget, Olivier Dussopt, unveil their new forecasts for 2020 and 2021, already presented in our columns. And “the recession will be less severe than expected», Explains the boss of Bercy, a few days before the presentation of the 2021 finance bill in the Council of Ministers.
In detail, the government now assesses the decline in activity at -10% this year, against -11% in the latest forecasts … And -1% in March. The government figure is darker than that communicated a few days ago by the Banque de France: the institution headed by François Villeroy de Galhau, for its part, expects a drop of 8.7% this year. A difference assumed by Bercy, who sees it as a sign of “responsibility“From the executive:”uncertainties persist“, Pleads Bruno Le Maire, but the authorities confirm their objective of returning by 2022 to the level of activity of 2019.
The deficit and public debt are also expected to be smaller than expected. The first should stand at -10.2%, against -11.4% according to the last budget bill, presented in June. The second will still climb to 117.5% of GDP, a level slightly lower than the 120.9% expected so far at the end of the year. The two heads of Bercy however recall that the budgetary trajectory will have to be quickly controlled: “this will require the pursuit of reforms and the choice to stabilize – or even slightly reduce – the public workforce next year», Says Olivier Dussopt. “A debt can be repaid“, Confirms for his part the boss of Bercy,”thanks to growth, control of public finances and the pursuit of structural reforms“. In addition, the “pension reformIs also invoked by the minister, recalling the government’s commitment to carry out this project.
Bercy maintains its employment forecast unchanged. 800,000 jobs are expected to be destroyed this year. 715,000 have already been affected, in particular on short and interim contracts. In the public service, “the winners of job creation will first of all be our territories», Announces Olivier Dussopt. Positions will be created in the sovereign areas of security, justice and national education. On the other hand, “some efforts“Will be made in other administrations, thanks to”in-depth reforms“Allowing”efficiency gains»In central structures.
A vigorous rebound in activity expected in 2021
Next year, the economic rebound and the effect of the stimulus plan should allow the French economy to rebound vigorously, specify the ministers. Growth should then stand at 8%, the deficit at -6.7% and the public debt at 116.2%, down slightly. Similarly, next year, several hundred thousand jobs – 320,000, according to Matignon – should be created, including up to 160,000 thanks to the stimulus plan alone. 10% of the plan envelope should also be disbursed by the end of the year, says Bruno Le Maire.
The minister also defends his supply policy, believing that sufficient support has already been put in place for demand, in particular thanks to partial unemployment. He specifies that aid for the purchase of electric vehicles will be maintained in 2021 “for electric and plug-in hybrid vehicles», Without specifying the level. “These aids have been a success: since the start of 2020, we have sold three times more electric cars than in 2019», He congratulates himself.
Saying that he is opposed to the principle of conditionality of aid granted to companies, the Minister of the Economy, however, is in favor of a commitment by groups by “a counterparty charter“Relating to three cases:”environment, governance and value sharing“. Companies should thus make commitments on several subjects, such as equality between men and women or the sharing of value with employees when better times return. No further details are given on the timetable for such a measure or on its effective implementation.
No tax hike to finance the recovery
No question of increasing taxes, which have “reduced by 44 billion euros»Since 2017 – including 22 billion for companies. If the levy rate will increase slightly this year, a logical consequence of the contraction in GDP, it should however quickly resume its decline, falling from 44.1% in 2019 to 43.8% in 2021. Bruno Le Maire also adds that the dependency would not be financed by additional taxes: “we need to be more creative and find other solutions», He believes.
The boss of Bercy does not seem convinced either by the proposal for an increased environmental tax on air transport, put forward by the Citizen’s Convention for the Climate: “it would be foolish to take back with one hand from the air transport sector what we give it with the other», He exclaims. For Bruno Le Maire, the new taxes should rather be decided at the European level, for example by implementing a Gafa tax by early 2021 or by applying a tax on financial transactions.
«We need 5G to stay in the innovation race», Pleads the Mayor
Bruno Le Maire also again defended the deployment of 5G in the territory, while several left-wing elected officials and environmentalists recently expressed their reservations on this issue. “We need 5G to stay in the race for innovation and improve the daily lives of the French“, Justified the leader of Bercy, who took the opportunity to address a pike to his political opponents:”a company that no longer wants to see the Tour de France, that refuses Christmas trees and says no to 5G, very little for me!“. The rejection of this technology is an act “selfish on the part of city dwellers who all have 4G and fiber», Adds, scathing, his deputy minister. Strong words, which echo the recent criticisms of Emmanuel Macron on the “Amish” society desired by environmentalists.