France Worried about Britain’s Economy

By Staff, Agencies 

French finance minister Bruno Le Maire announced that his government is "worried" about the economic situation unfolding in Britain.

Le Maire, chancellor Kwasi Kwarteng's opposite number across the channel, said the UK was paying the price for leaving the EU.

And he said the reaction to Friday's budget showed the danger of making "dramatic" economic policy turns.

It comes after financial markets hammered the pound and government debt after the UK government announced sharp unfunded tax cuts.

Chancellor Kwasi Kwarteng and prime minister Liz Truss claimed their budget would boost growth, but have been met with soaring debt costs and the prospect of surging interest rates.

Earlier this week the Bank of England was forced to step in to secure the stability of pension funds, which were left exposed by the sudden market movements.

"I am not worried about the euro but I am worried about the situation in Britain," Le Maire told Europe 1 radio on Friday.

"It shows that dramatic announcements do not work."

He added: "Leaving Europe comes at a considerable cost because Europe offers protection (...) the euro zone protected us during the Covid crisis."

Inflation is currently at 9.9 per cent in the UK; in France the annual figure for 2022 is expected to be around 5 per cent. The government there has controlled energy prices and nationalised public supplier EDF to help it weather the storm.