France's debt set to hit record 121.7% of GDP by 2027 as deficit climbs

France's public debt is set to hit 119.3% of GDP in 2026 and rise to 121.7% in 2027 - the highest level since 1995 - while the budget deficit is forecast at 5.4% of GDP this year, up from 5.1% last year, before easing to 5% next year when presidential elections are held. The government told its fiscal watchdog it plans 54 billion euros (about $62 billion) of spending cuts in the 2027 budget, though it left politically sensitive items such as tax breaks for pensioners to parliament to decide. Economists note the French economy has been slowing since the third quarter of last year, hit by weak consumer spending and a surge in energy prices linked to the US-Israeli conflict with Iran.

For Nigerians, France's deepening fiscal trouble matters because the eurozone is a major trading partner and a source of external finance; a weaker euro or tighter EU fiscal stance can sway global interest rates, affect oil-price volatility, and shift investor appetite toward or away from emerging markets like Nigeria. Higher debt levels also raise concerns about spillover effects on European banks that lend across Africa.

What should you know or do? Keep an eye on euro-dollar exchange rates and global oil price trends, as they can influence Nigeria's export earnings and the cost of servicing foreign-denominated debt. If the EU moves toward stricter austerity, consider how reduced European demand might affect Nigerian exporters of goods such as crude oil, cocoa, or textiles, and plan accordingly.

SOURCE: https://www.channelstv.com/2026/09/19/frances-debt-climbs-to-highest-since-1995/