whether francois bayrou can succeed where his predecessor failed. this is bloomberg. ♪ >> redline is to choose to come back and increase tax. everything we hear now shaping the debate is increasing tax, having tax on the corporations, having tax on household, on the airlines. this is not a good way because the problem that could lead us to that is in excess of public spending. tom: that was the vice president of the french business union speaking to bloomberg. the french prime minister is due to present his policies to parliament. francois bayrou faces tense discussions on the budget with france relying on special laws to keep government functioning. until they get the budget across the line. let's go live to paris. what can we expect from the new pms policy speech? how consequential will it be? >> we will hear about immigration, pension reform and the budget the new prime minister francois bayrou has promised. he should deliver by mid february, which is ambitious, given we are mid january. his predecessor was toppled by emotion of nonconfidence ear

we have to wait and see from francois bayrou today. >> it is a tough choice.freeze the pension reform to avoid political chaos, that will have fiscal implications and whatever i read, everyone expecting limited fiscal changes for this year. let's discuss this in more detail with our next guest. the chief european economists at barclays. sylvia, good to have you on the show. first and most, what are your expect ations from the pre minister later today? >> good morning. thanks for having me on the show. our expectations is the growth target will be to the downside and the target that was set by this economic minister will not be reachable to the extend it would likely to be announced. on the growth front, our forecast is significantly lower than that of the previous. we are expecting growth to be .7% this year. that is not far from the bank of france has. on the deficit targets, we already thought with the government from prime minister barnier, many measures were not obtainable. we had the forecast for 2025 slightly below the 2024 one aside from gdp. i think th

france's new prime minister, francois bayrou, is holding his first cabinet meeting after a deadlock over budget brought down the government of his predecessor, michel barnier. monsieur bayrou is expected to push ahead with tax rises and spending cuts amid growing investor concern over the state of france's finances. on thursday, more bad news on the economy as a survey showed that last month france suffered the biggest slump in manufacturing activity in five years. let's bring in tomasz michalski, associate professor of economics at the hec business school in paris. it's a delicate government, its mission is to pass an amendment to the 2025 budget. remind us why that was so important and so controversial. the issue is we didn't have agreement in the parliament is among the main forces over what the budget should look like, whether there should be tax increases or not and whether there should be cuts. the government eventually fell because of the budget and the laws of funding social security. the new government starts with the same copy and it is going to try to find resolution by negoti

to france now, where the new prime minister, francois bayrou is meeting with representatives from theal producer in the european union, french farmers have been protesting about the recent free trade deal with the mercosur group of south american countries. the french farmers fear it would lead to a raft of cheap imports — not made to eu standards — that they can't compete with. and are calling for it to be blocked. charlotte emlinger is an economist at cepii, the government funded french centre for research and expertise on the world economy. she specialises in agro—food trade. hello to you. should this deal be blocked in your opinion? farmers unions are meeting today with the prime minister today with the prime minister to make sure that promises made ijy to make sure that promises made by the former government will be kept and the farmers are opposed to the agreement between the agreement and mercosur because it fails a competition of big exporters of argentina and brazil, other countries that are really competitive and i have less aggro standards. but overall the competition is ex

francois bayrou is the fourth french prime minister in 2024.ill has to pass a budget that reassures market and provides enough consolidation and goes in the direction of eu fiscal rules, but without facing the fate of his predecessor michel barnier, who was voted down on the budget. lizzy: we talked about ecb president christine lagarde's new year's message yesterday but i should hate to neglect the snb, it has been cutting rates faster than expected, what comes next? >> the snb had a december surprise of 50 basis point cut, when 25 basis points was expected. they have cut by 125 basis points this year. very low rates. in december, it sounded like they were less worried about upside pressure on the franc, but more worried about domestic weakness. we think there is little policy space left but the snb will have to deliver more cuts. we see one more rate cut in march with risks tilted toward further easing especially if the franc starts to appreciate again. lizzy: maeva cousin, bloomberg's chief trade and climate economist, we thank you for that