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New Popular Front in Focus 

Travel Tuesday, continued turmoil in France after the elections, a look into the New Popular Front in France, and an update on Ukraine rescue missions.

Travel Tuesday: Rwanda
Every year on September 1st, Rwanda holds a special ceremony called Kwita Izina. This ceremony celebrates baby gorillas born in the previous year and gives them names. It’s a colourful and joyous event that highlights Rwanda’s commitment to gorilla conservation.
GDP $14.10 billion
Biggest Export Gold, Tin Ores, Coffee, Malt Extract
Biggest Trading Partners UAE, Democratic Republic of the Congo, Thailand, USA, Ethiopia
Political System Republic with an executive president and a multiparty democratic system. The president is the head of state with significant executive power, with the Prime Minister being the constitutional head of government.
National Animal Leopard
Next Election 15 July

French Elections Continued…

Political turmoil continued in France yesterday, with Macron rejecting prime ministers’ Attal’s resignation, asking the leader of the Ensemble alliance in the National Assembly to stay “for the time being to ensure the country’s stability”.

This comes as no alliance managed to cross the 290-seat threshold needed to form a government with Macron’s Ensemble party securing 168 seats to the New Popular Front’s 182.

Who are NFP?

NFP or New Popular Front is a broad based left-wing coalition of parties including La France Insoumise (Jean-Luc Mélenchon’s party), the Socialist Party (the party of former French President François Mitterrand), the Ecologists (a left-wing party with affiliation to the European Greens), Génération.s (which split from the French Socialist Party in 2017) and the French Communist Party (which dominated the left of French politics from 1945 to the 1960s and was founded by Hồ Chí Minh and three others in 1920).

One of the alliance’s flagship economic policies is to reduce the retirement age down to 60, reversing the highly controversial 2023 French pension reform law which increased the state pension age from 62 to 64 and led to considerable unrest across the country.

The alliance will also seek to increase the state’s minimum wage by 14% and ensure that salaries are adjusted to keep up with the rate of inflation. This comes alongside the bloc’s plans to increase public sector salaries by 10%.

In an effort to undo one of Macron’s key reforms, the alliance has pledged to reintroduce the ‘Impôt De Solidarité Sur La Fortune’ (or Solidarity Tax On Wealth), which was a direct tax on wealth for anyone owning assets over €1,300,000. This law, initially introduced by the Socialist Party in 1981 was abolished five years later by Jacques Chirac before being re-introduced in 1988 and again re-abolished in 2017. By 2007, its estimated that the tax brought in over €4.4 in revenues, however critics argued that many of France’s highest earners simply left the country.

Concerns are now growing over the fiscal implications of a potential NFP budget (though it’s important to note that any NFP budget would have to be ‘watered down’ given the number of seats they hold).

For example, its estimated that NFP’s pledges amount to around €150bn worth of fiscal loosening. However, given France’s precarious fiscal position, many see that the Treasury could ill afford such a move.

Under Macron, France’s debt has risen from around 100% of GDP to as high as 117%, before stabilising at around 110.6%. Such an increasing in spending would therefore likely cause this figure to rise, putting further pressure on French sovereign debt.

It’s worth noting that France already has a budget deficit of around 5% of GDP – the second highest in the Eurozone and over three times that of Germany – with many therefore arguing that Paris should look towards fiscal tightening to shore up their financial position.

Ukraine

Rescue missions remain underway following a wave of Russian missile strikes on Ukraine. At least 166 people have been injured and 41 killed in Ukraine, including some at children’s hospital in Kyiv. The attack has seen widespread condemnation, with President Biden vowing to put further support into Ukraine’s air defences. Biden’s comments come ahead of tomorrow’s NATO summit in Washington where the conflict in Ukraine will be top on the agenda. 

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