France’s social unrest is a symptom of its wider economic decline

Children of immigrants across much of suburban France feel that nothing has changed in their lives compared to others in more prosperous neighbourhoods.

Unemployment is high, delinquency and drug use are common, and poverty and marginalisation prevail. Immigrants make up about 11% of France's population. But among the immigrant population, only 36% have obtained French citizenship according to the 2022 Interior Ministry census.

The social problems look worse in the suburbs of Paris and north of Marseille. Neighbourhoods here have become violent and they are often avoided by the police.

Reaction to the riots across French politics was divided, highlighting the gulf in opinion in the country over a sensitive and highly visible issue.

Huge political divide

Right-wing parties called for a militant response, including the introduction of a state of emergency. Advocates for this included the parties of Marie Le Pen and Éric Zemmour, who is known for his anti-Maghrebi and anti-Muslim attitudes.

Similar calls were also made on national media by pundits affiliated with anti-immigration movements, especially Muslim immigration.

There were also voices in support of the youths, mainly from the left.

The leader of  La France Insoumise party – former presidential candidate Jean-Luc Mélenchon, a Frenchman born in Tangier, Morocco – defended the constitutional and economic rights of immigrants and their right to express their views and reject repeated police violence.

He also lambasted the government's irresponsible handling of legitimate and originally peaceful social and economic grievances.

The economic repercussions — during the peak tourist season — have stoked fears about growth in the third quarter of the year, when France usually attracts millions of visitors.

Wider unease at the social state of the nation, if left unchecked, could affect the investment case for the country, as Macron seeks to attract international capital for a programme of re-industrialisation to revive the economy.

Some of those policies, which need foreign direct investment from the likes of Asia, the United States, and the Gulf states, are designed to help the kind of places in France that were worst hit by the rioting.

Complex problems with colonial roots

Nahel Marzouki's untimely and violent death and the national crisis it caused are directly related to France's colonial role in Africa and its subsequent decline.

This and the wider waning of France's status as a world power are likely to exacerbate the economic problems it faces at home, especially when there is so much social inequality in immigrant communities.

France ranked fifth for income-per-head in world economic rankings 50 years ago. Under Macron, it is now in 26th place, and it has been surpassed by emerging and developing countries that have been able to strengthen their position and take on a more prominent global role.

More recently, the world economy has faced further shocks from the Covid-19 pandemic and Russia's invasion of Ukraine, sparking a wave of inflation that has been corrosive within European economies.  All this leaves former colonial powers scrambling to deal with rising powers like China and Russia.

Ballooning debt

France also faces concern over its €3 trillion debt burden, which stands at 112% of the size of its economy as measured by gross domestic product. That makes the country the fifth most indebted EU nation, behind Greece, Italy Spain and Portugal.

It means the country is spending around €70bn a year just to service its debts — an equivalent amount to the education ministry's annual spending.

When ratings agency Fitch cut France's credit rating to AA-minus from AA, it pointed to the way protests were met with force and the manner in which controversial pension reforms were pushed through parliament amid a lack of consensus as factors influencing the decision. 

Fitch expects "the French economy to grow by only 0.8% this year and about 1.3% in 2024." The Institut National de la Statistique et des Études Économiques said that the French economy recorded growth in the first quarter of this year of just 0.2%. While that meant it avoided recession, the weak expansion also came with an uncertain outlook.

This economic and financial decline, which also contributes to the acute social problems in the suburbs, is also likely to be part of a wider unease.

A poll by the Institut Français d'Opinion Publique found that 83% of French people live in a state of anxiety. The survey said 39% of those polled had become more concerned since the pandemic.

Other sources of concern include Russia's invasion of Ukraine, rising inflation, high prices, climate change, and unpopular government decisions. The proportion of worried people was up nine percentage points from a survey three years ago.

Meanwhile, the 2023 World Happiness Report excluded France from the top 20 optimistic countries. It ranked Scandinavian states ranking at the top while Germany and the United Kingdom kept their place on the list and some Arab countries joined.

99 problems and Fitch is one

President Macron criticised the Fitch rating cut. In an interview with l'Opinion, he said: "Fitch is wrong in its political analysis because we have strong institutions capable of passing bills, including the pension law."

He pointed out that democracy in his country isn't threatened, adding that French workers need to work more and retire later, as they produce 10% less productive than their German equivalents. Macron said:  "This needs restructuring (in) France, attracting foreign investment, and betting on technology and the green economy."

Nonetheless, these changes to the international view of France look like a blow to the country's economy and political scene.

The influential newspaper Le Monde said: "The government, which was betting on speeding up the passage of the pension law, sent the opposite message to reassure the markets about the financial situation of France and this is a mistake."

"It's true that extending the years before retirement will save €10 billion to the treasury annually, but the image of France has been shaken at home and abroad, leaving deep wounds that have yet to heal." 

Germany has signalled its reluctance to support plans to extend a scheme for shared European bond mechanisms brought in during the pandemic to harness the wider borrowing power of the eurozone.

Sources close to Berlin have characterised France as wanting to act like a rich nation from the north of the continent while asking for the kind of support often associated with southern Europe.

Then there is a wider feeling that France's behaviour can be arrogant. Such an approach has annoyed Germans, Europeans, Africans, Maghrebis, and other parts of the world.

Paris is facing open diplomatic breaches with more than one European country, notably Italy, which has demanded an apology from the interior minister for comments on clandestine immigration. It's a sensitive issue for the right-wing government of Rome, which fears a mass exodus from the southern Mediterranean.

Read more: France and Italy navigate present-day tensions against backdrop of historical rift

Paris is also at odds with Madrid over the construction of a pipeline of natural gas and green hydrogen that passes through the Pyrenees toward France. Relations with Rabat, and several African capitals, have also deteriorated.

None of this helps the French economy or French firms active abroad,  at a time when there are already warning lights flashing over key numbers at home.

Pessimism in official forecasts from the central bank

France's central bank forecast that economic growth will slow significantly in 2023 due to the energy and inflation crises, with the "most likely scenario" taking it down to 0.6% this year, from 2.6% in 2022.

Olivier Garnier, director general at the central bank for economics and international affairs pointed to the impact of the energy crisis during the winter for the drop. He predicted a recovery to growth of 1.2% in 2024 and 1.7% in 2025.

Plunging popularity

Macron's popularity has plunged since he forced through his unpopular pension reforms.

In pictures: Protests erupt as French government raises retirement age

Since he did so, his country's internal social cohesion has declined sharply and visibly. The state of Paris' relations with neighbours and allies has declined. Marcon is unpopular on more than one continent. In Africa, he has been insulted by more than one fellow national president in front of journalists.

His diplomacy over the war in Ukraine also left him looking exposed, not least when a visit to Russia left him sitting opposite Russian President Vladimir Putin but at the other side of a table the size of a basketball court.

Half a century ago, as well as being higher up the global economic rankings, France had a reputation for fashion, style and sophistication.

In its capital, once famed as the City of Light, it is now much darker. Paris is unable to achieve social and economic equality for millions of its citizens, sparking riots and disorder. This looks like more than a lack of social cohesion – there are serious symptoms of deep-rooted division in society.

That has worsened an already bleak economic outlook just as at least one international financial institution cuts the country's credit rating, citing over-bearing political leadership, just as the government seeks inward investment.

And so, in today's France, we see the kind of conditions which were, until recently, more closely associated with countries of the Third World.