Paris (AFP)

About 45 billion to support the most vulnerable sectors while the recession promises to be terrible with a fall in GDP of 11%: the government presented Wednesday in the Council of Ministers a new crisis budget.

This is the third amending finance bill (PLFR) drawn up since the start of the crisis, unheard of.

"The gravity of this recession calls for a massive response, and it is this massive, immediate and effective response that we have brought," said Minister of Economy Bruno Le Maire after the Council of Ministers.

"All the sums which are devoted to this response to the economic crisis represent, with this PLFR 3, 460 billion euros, that is 20% of the French national wealth", he added.

This draft budget mainly focuses on support plans for the most threatened sectors. It includes the € 18 billion plan in the tourism sector, one of the most affected by containment, the € 8 billion plan for the automobile, the € 600 million for French Tech, or the 15 billion euros of support to the aeronautical sector and aid to the book sector. There will also be measures in favor of small trade and construction.

For the latter sector, the government plans in particular to compensate for the additional costs generated by health measures on construction sites.

As "a wave of bankruptcies" and "hundreds of thousands" of jobs are looming, according to Bruno Le Maire, the government will strengthen the short-time working scheme by around 5 billion euros and release 1 billion for extend aid to companies hiring an apprentice.

"We want to (...) protect jobs and accelerate the transformation of French industrial sectors", assured the Minister of Economy.

With the resumption of the looming activity, the boss of Medef Geoffroy Roux de Bézieux called in an interview with Les Echos to speed up deconfinement and to "revise the health protocols applying in companies".

First opening in this sense: Matignon announced Tuesday evening its wish to end July 10 at the state of health emergency.

Even if in Bercy a policy of support for "supply" is defended, the budget will also include exceptional direct aid for the 800,000 precarious young people under 25 and the poorest households.

Finally, it confirms 4.5 billion euros in support from the State for local authorities, when their revenues are melting with the crisis.

In total, however, the additional direct budgetary expenditure will only represent 13 billion euros, the rest being cash flow measures (charge deferrals, guaranteed loans, etc.).

Some sectors feel forgotten, such as agriculture or public transport.

The environmental NGO Greenpeace regrets that alongside plans for the automobile or the air, there is "always zero for the revival of the railway".

- Record recession, deficit and debt -

In addition to these aid plans, the government is forced to further worsen its economic forecasts for this year. It now expects a recession of -11%, against 8% decline in GDP expected only a few weeks ago.

The difficulties in the tourism sector alone should cut GDP by almost a point this year.

Consequence: with tax revenues that will melt by 27 billion more compared to the already declining estimate of the previous rectified budget, the deficit should further worsen to 11.4% of GDP and the public debt swell to 120, 9% of GDP, estimates the government.

"In just three months, the changes in the macroeconomic and public finance trajectory are massive and they are obviously unprecedented," commented the new president of the Court of Auditors and the High Council of Public Finance (HCFP), Pierre Moscovici.

In its opinion on this draft budget, the HCFP expressed concern that the government may have underestimated the expenditure planned to face the crisis, and conversely minimize the loss of expected revenue, which could worsen the deficit.

© 2020 AFP