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TRAVEL NEWS

France announces €100bn plan to develop rail network

French Prime Minister Elisabeth Borne announced on Friday a vast rail development programme, valued at €100 billion, that will be rolled out over the next 20 years to make the train "a real alternative to the car" across France.

Published: 24 February 2023 17:24 CET
France announces €100bn plan to develop rail network
(Photo by Lionel BONAVENTURE / AFP)

The plan includes plans for better maintenance for the existing rail network, but also launching new lines including night train routes and expanding the commuter rail networks in cities.

Commuter rail networks in more French cities

Borne confirmed the government’s goal to launch new commuter lines in “suburban areas and medium-sized cities” in France, which would add to existing urban rail lines and the TER (regional train) network.

“The use of rail services will evolve, with more trains, at more frequent intervals, that are better serving areas where people live”, Borne said.

“Our strategy must benefit all French people, wherever they live, from small towns to major cities”.

This echoes previous statements made by President Emmanuel Macron, who said in November that he hoped to expand RER-like rail services to “the ten main French cities.”

READ MORE: Macron wants new suburban train network in France’s main cities

Investing in maintenance

The French prime minister explained that her goal was to make taking the train a “credible alternative to the car”, and in order to do so the government hopes to increase investment in the existing rail network.

She laid out plans to pay out €1 billion per year over the next five years for the “renovation” of the network, and an additional €500 million per year for its modernisation”.

The objective is for France’s railways to offer users “more trains, with better punctuality and shorter journey times”.

Night trains

In her speech, Borne referenced plans to relaunch France’s night train network, but did not offer specific details on the subject.

MAP The proposed new routes for night trains in France

Collaboration with regional authorities

The Prime Minister said that the draft bill for the “nouvelle donne ferroviaire” (new rail deal) will include a budget of €100 billion, to be paid by the French state, “alongside the SNCF (national rail service), the European Union and local authorities”.

Borne said that the French government will negotiate plans with local authorities, and that the next step for the project will be in March, when regional authorities will receive their terms for negotiation. The country will also launch an inter-ministerial committee to monitor the plan in the coming weeks.

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ECONOMY

S&P downgrades French credit rating in blow to Macron

Ratings agency Standard & Poor's downgraded France's credit score on Friday citing a deterioration in the country's budgetary position, a blow to Emmanuel Macron's government days before EU parliamentary elections.

Published: 1 June 2024 15:44 CEST
S&P downgrades French credit rating in blow to Macron

In a statement, the American credit assessor justified its decision to drop France’s long-term sovereign debt rating from “AA” to “AA-” on concerns over lower-than-expected growth.

It warned that “political fragmentation” would make it difficult for the government to implement planned reforms to balance public finances and forecast the budget deficit would remain above the targeted three percent of GDP in 2027.

The S&P’s first downgrade of France since 2013 puts the EU’s second-largest economy on par with the Czech Republic and Estonia but above Spain and Italy.

The announcement will sting for Macron, who has staked a reputation as an economic reformer capable of restoring France’s accounts after low growth and high spending.

The risk of a ratings downgrade had been looming for several quarters, with the previous “AA” assessment given a “negative outlook”.

The surprise slippage in the public deficit for 2023 to 5.5 percent of Gross Domestic Product (GDP) instead of the expected 4.9 percent did not play in the government’s favour.

France’s general government debt will increase to about 112 percent of GDP by 2027, up from around 109 percent in 2023, “contrary to our previous expectations”, the agency added.

Responding to the downgrade decision, Economy Minister Bruno Le Maire reaffirmed the government’s commitment to slashing the public deficit to below three percent by 2027.

“Our strategy remains the same: reindustrialise, achieve full employment and keep to our trajectory to get back under the three percent deficit in 2027,” he said in an interview with newspaper Le Parisien, insisting that nothing would change in the daily lives of the French.

Le Maire claimed the downgrade was primarily driven by the government’s abundant spending during the Covid pandemic to provide a lifeline to businesses and French households.

The main reason for the downgrade was because “we saved the French economy,” he said.

Government critics offered a different rationale.

“This is where the pitiful management of public finances by the Macron/Le Maire duo gets us!” Eric Ciotti, head of the right-wing Republicans party, wrote on social media platform X.

Far-right leader Marine Le Pen called the Macron administration’s handling of public finances “catastrophic” and denounced the government as being “as incompetent as they are arrogant”.

A credit downgrade risks putting off investors and making it more difficult to pay off debt.

Earlier this year, influential ratings agencies Moody’s and Fitch spared handing France a lower note.

S&P also maintained its “stable” outlook for France on Friday on “expectations that real economic growth will accelerate and support the government’s budgetary consolidation”, albeit not enough to bring down its high debt-to-GDP ratio.

“S&P’s downgrading of France’s debt simply reflects an imperative that we are already aware of: the need to continue restoring our public finances,” Public Accounts Minister Thomas Cazenave wrote in a statement sent to AFP.

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