How is the government's 100 billion euro stimulus plan financed?

DECRYPTION

How to find 100 billion euros?

The stimulus plan planned by the government to combat the effects of the coronavirus is due to be presented on Thursday.

According to the government, this is a plan that is unprecedented in its scale and which aims to accelerate the ecological transition, to relocate or develop French skills.

A large sum that requires several sources of funding.

Four times more money than after 2008

With an amount of 100 billion euros, the government's plan is the largest stimulus plan in history.

In fact, it is nearly four times more money than the plan of Nicolas Sarkozy after the financial crisis of 2008. By comparison, it is also twice the budget of National Education.

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This large sum will have several sources: 40 billion euros from the European Union, as part of the recovery plan accepted by Brussels but also loans as well as a contribution from the deposit fund.

In an interview with

newspaper

Jean Castex guaranteed that no tax hike was on the agenda to finance this plan.

"This is the mistake that was made in the last crisis and we will not repeat it," he said.

Return in 2022 to the pre-crisis level

This plan should be used to finance very concrete projects such as the relocation of future technologies in France, the energy renovation of public buildings or the development of cycling.

In economics, we talk about supply shock.

As a minister admits, it would have been easier to lower taxes and increase the activity bonus, but that would have been useless, he adds.

A tax cut of 3.3 billion is however planned for companies, which worries the Association of Mayors of France who fear a "weakening" of their resources.

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What the government says it wants with this plan is to prepare France for the future.

For the executive, the resumption of employment and the decarbonization of the economy are the only objectives that can allow it to start again.

In his interview, Jean Castex recalls three priorities: "the greening of our economy, social and territorial cohesion and making France more competitive and more sovereign".

The goal is to return in 2022 to the pre-crisis level.

While a recession of 11% is expected this year, some at the Ministry of the Economy consider that this would be a feat.