France’s student protests highlight a debt crisis that could spill over to the rest of Europe

France’s student protests highlight a debt crisis that could spill over to the rest of Europe

France’s unprecedented wave of student protests has laid bare the country’s growing financial pressures, which will only become more difficult to tackle as Europe’s second-largest economy tries to rein in a ballooning budget deficit.
The country’s finances are in a precarious state. Public debt was more than $4 trillion in June, exceeding the size of the economy, according to the country’s statistics agency. The cost of servicing that debt has climbed by billions of dollars on last year, as bond yields spike.

At the same time, demands on the public purse are rising: Pension costs have climbed because of an aging population while the government looks to spend more on defense.

High school students, meanwhile, have called for a fix to staff shortages, overcrowded classrooms and crumbling school infrastructure.

Solutions to France’s financial troubles have led to social unrest in the past. Efforts to raise the retirement age sparked widespread protests in 2023.