N. Peter Kramer’s Weekly Column
The pontifical and pompous re-opening of the Notre Dame Cathedral, five years after the devasting fire, cannot conceal that France is sinking into an unprecedented political crisis after the (radical) left and the radical right brought down the French minority government. Remarkable is that the financial markets remain calm, while there is now no solution for the disastrous financial situation of the country. The interest that France has to pay on new government debt is not increasing any further. The difference with Germany, the so-called ‘spread’, remains around 0,80 percentage points. The interest rate jump upwards already happened in June, when President Emmanuel Macron announced unnecessarily early elections and lost his majority in the Assemblee Generale.
For the time being , there is no speculation against France, as there was against Greece after its financial crisis. France is a rich country said Macron, that can meet its payment obligation. The bond vigilantes, the watchdogs on the financial markets, are awake but have not yet smelled blood. At least for the time being.
That does not alter the fact that the political paralysis in France could not have come at a worse time. In Germany, too, the government is on its last legs. Both countries form the central axis of the European Union. Among the general frustration, euroscepticism is also growing in both countries. In surveys of confidence in the EU, France is at the bottom of the list with 35 pr cent, Germany has dropped to the 23rd place out of 28 member states. Worrying, now that the EU has to reinvent itself economically and militarily.
