France’s citizens are now under the leadership of a new government, after the messy parliament elections. Michel Barnier is the new prime minister of this nation. He is the former European Commissioner. Mr Macron chose him to run France’s affairs. Michel Barnier has introduced a new cabinet. It is composed of nearly 40 ministers and secretaries of state. Most of these officials belong to Macron’s centrist party and many right-wing groups. Furthermore, Michel Barnier himself represents the right-wing party Les Républicains (LR).
This new government was not built with the happiness of supporters of the left-wing coalition Nouveau Front Populaire (NFP). They got a huge number of votes, but it does not have much representation. This situation indicated the troubles faced by leftist groups in the unstable political landscape.
However, founders and investors seem to feel safe after weeks of political uncertainty. This suggests that the new government’s stability might help business interests.
A path of complexities to build the new government. It is very challenging to build a new government in France. The results of the July Parliament elections were uncertain. No party gained as many votes to have a majority. It included Macron’s group and the far-right Rassemblement National (RN).
This uncertainty in votes makes it hard for French President Macron to form the new government that runs the country, like passing laws and budgets. Many tech sectors in France run under the leadership of Macron. They all are concerned about potential government changes. They were concerned that not getting Macron’s support for startups could hurt France’s international position. This nation is a leading tech hub in Europe.
Over the last 10 years, enterprises like “La French Tech” reinforced by the public bank Bpifrance, have supported France’s startup boom. The initiator of the fintech company, Alexander Prot, points up the need for a sympathetic environment to continue tech companies in Europe and France. It is decisive for the tech industry in the future.
The new leader of France, Barnier, has mostly made the tech industry in France happy. Different people, like Marc Ménasé, believe that the new government understands the importance of France’s competition with foreigners. The nation needs to stay competitive and grab foreign investments. Now the question is why are tech companies happy? The key reason for this happiness is the appointment of Clara Chappaz as secretary of state for AI and digital. Under her leadership, ‘La Mission French Tech’ ran for more than 3 years. Now, she is a strong leader in the startup community.
Véronique Torner, president of Numeum, a group for French tech companies, praised Chappaz and talked about their successful work together. However, the real challenge is still ahead. The tech industry is now watching closely to see if the government will take real steps to support and grow the industry. What happens next is very important for keeping progress and ensuring success for tech in France in the long run.
The upcoming week is important in France’s history. Founders and venture capitalists (VCs) will closely observe Barnier’s capabilities. How his government will manage the nation’s 2025 budget. This is one of the toughest challenges that the prime minister has faced. This is because of the European Council’s action against France for exceeding budget limits. How will the new government manage the complexity of this deficit? Barnier may consider increasing taxes. Ménasé emphasizes that the government faces tough choices and hopes these decisions won’t overlook support for startups. However, in 2018, Macron established the “flat tax” might discourage investments.
Ménasé warns that any tax changes must be carefully considered. They could make investors less confident and give them less money, which is important for the growth of startups in France. Balancing the budget while nurturing innovation will be crucial for the country’s economic health.
Barnier’s government’s future is in limbo. The upcoming elections may be held in June 2025, and also RN parting is insisting on this late election. Unpredictability is not fair for business, and also it is showing France as a less attractive foreign partner. When partners see uncertainty many times, they hesitate to invest.
Menase highlights the need for connecting with foreign partners.
“I am traveling a lot to meet them and explain the current situation,”
he says.
He trusts it is required to continue boosting France as a powerful option for investments. A stable and confident act will help to attract more partnerships, especially in times of unpredictable environments. Making a center of France’s strength can cheer up investors and inspire them to keep their interest in the country.
