France Faces Political Turmoil as PM Bayrou’s Confidence Vote Backfires

France is reeling from a deepening political and economic crisis after Prime Minister François Bayrou’s unexpected call for a September 8 confidence vote on his €44 billion ($51 billion) budget cut plan backfired, threatening to topple his centrist government. The move, intended to address France’s 5.8% GDP deficit—far exceeding the EU’s 3% target—has united opposition parties, including the far-right National Rally, Socialists, and France Unbowed, who vow to vote him out. With opposition groups holding over 320 seats in the National Assembly compared to the centrists’ 210, Bayrou’s government faces almost certain collapse.

The announcement jolted financial markets, with the CAC 40 index dropping 1.6% and French 10-year bond yields spiking to 3.53%, the highest since March. Shares of major banks like BNP Paribas and Societe Generale fell over 6%. Bayrou, 74, in office since December, urged lawmakers to choose “responsibility” over “chaos” during a speech on Tuesday at a labor union conference south of Paris, where he stumbled on stage—a moment symbolizing his precarious position. He later told journalists, “One can think it over,” signaling openness to budget negotiations, possibly softening contentious proposals like eliminating two public holidays.

If the confidence vote fails, President Emmanuel Macron, who plans to remain in office until 2027, must appoint a new prime minister—his third in a year—or call snap elections, a step he has previously ruled out. Analysts at Capital Economics predict a new prime minister is more likely, but France’s budget woes and political gridlock may persist. With protests planned for September 10, reminiscent of the 2018 Yellow Vest unrest, France risks further destabilization, threatening its economy and international reputation.