The agency has flagged governance challenges and ballooning liabilities in its latest sovereign review
S&P Global has downgraded France’s long-term credit rating from AA- to A+, warning that rising debt and political tensions threaten the government’s ability to reduce its budget deficit. The agency also revised France’s outlook to ‘stable’ on Friday.
S&P expects France’s government debt to reach 121% of GDP in 2028, compared with 112% at the end of last year, the agency said. The country has struggled to rein in spending while dealing with political turbulence. Prime Minister Sebastien Lecornu recently survived two no-confidence votes in parliament after suspending a contested pension reform package.
S&P warned that uncertainty surrounding France’s public finances remains high, especially ahead of the 2027 presidential election. The agency cited the government’s decision to suspend the 2023 pension reform law as a sign of political fragility. It also projected economic growth of 0.7% in 2025, with only a muted recovery expected in 2026. S&P added that risks to the outlook remain significant, particularly if rising government borrowing costs spill over into broader financing conditions in the economy.
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