Hopes are high the finance veteran, who leans politically left, will help to unite France’s fragmented parliament over the budget.
Is a career banker the right man to solve France’s disastrous public finances? Apparently so.
On Monday, the new French government formed by Prime Minister François Bayrou appointed finance veteran Eric Lombard to the difficult role of economy and finance minister.
Lombard comes to the role from Caisse des dépôts et consignations, the investment arm of the French state, where he was director general.
Lombard will now be charged with the politically arduous task of delivering France’s long-overdue budget for 2025 and cutting the country’s massive deficit, while simultaneously keeping financial markets and the European Commission appeased that France’s economic fundamentals won’t be derailed in the process.
“I am aware of the difficulty of the task,” he said during a handover ceremony at the economy ministry on Monday night as he pledged “to reduce the deficit without killing growth.”
Unlike many of his predecessors, the new minister is not a career politician, which means he enters the role with the possible advantage of having little political baggage and few entrenched affiliations that often hinder reform efforts.
Within France’s economic circles, meanwhile, Lombard has already cultivated a reputation as a skilled and pragmatic operator who has long had an eye on politics.
“He’s been very, very keen to get into politics for a very, very long time,” said a French official who knows him well and was granted anonymity to speak freely.
Lombard by name, lombard by nature
Before joining Caisse des dépôts, Lombard was the head of the French division of Italian insurance giant Generali, until the group’s CEO, Philippe Donnet, replaced him with Jean-Laurent Granier.
Before that, Lombard worked for nearly 20 years at BNP Paribas in various high-level positions including as president of the bank’s insurance arm.
But it’s his most recent stint at France’s public investment arm that is likely to have prepared him most for the job given the French government’s inclination to intervene directly in the economy, especially in strategic sectors.
During his time at the « Caisse, » Lombard will have experienced what it is like to work under public scrutiny thanks to the institution’s role in allocating public investments. Working in his favor is the fact the institution registered €3.9 billion in profits last year, of which €2.5 billion will have been returned to France’s state coffers.
“He has a strong political sense and strong convictions, backed up by great financial and managerial skills,” said French businessman Bernard Spitz, who co-founded the social-liberal think tank “les Gracques” with Lombard.
“He will be able to judge independently, and will have the trust of the markets, in France and abroad: this is a major advantage in the country’s current financial situation,” he told POLITICO.
Those who know him add Lombard is a lover of music who, despite coming from a rich family of industrialists and modern art collectors, leans left politically.
Indeed, despite spending most of his career in the private sector, Lombard’s brush with public service comes as an adviser to former socialist Finance Minister Michel Sapin.
Thanks to the role, however, Lombard will have gained experience of French administration and in particular the French Economy Ministry, known in France as “Bercy.”
French President Emmanuel Macron appointed Bayrou as French prime minister this month, after the National Rally and the New Popular Front coalition joined forces to topple Michel Barnier’s government.
As a result, Barnier’s budget for 2025 was also rejected, leaving France without the relevant law just a few days before an end-of-year deadline. Bayrou now hopes that France will pass a new budget by mid-February.
In the meantime, the outgoing government has passed a stopgap budget, which effectively carries over the 2024 budget to 2025 to prevent a U.S.-style shutdown in January. But the stopgap does nothing to reduce France’s deficit, which reached 6.2 percent of the country’s GDP this year, twice the level permitted by EU rules. France is already under an excessive deficit procedure in Brussels for breaching limits in 2023.
So far, there are no indications that Bayrou’s government can succeed where Barnier has failed. Bayrou can only count on the same fragile parliamentary coalition built by Barnier — which includes Macron’s centrists and the right-wing Republicans — as he has failed to get the support of France’s socialists.
Some in Macron’s camp, nonetheless, hope that Lombard’s appointment could help to build bridges with the left. An adviser from Macron’s camp went as far as saying that Lombard’s economic doctrine “is pure social-democracy.”
Other indicators Lombard skews left, beyond his role with socialist Sapin, is the fact he described himself as “left wing” in a book he wrote two years ago, according to Le Monde. In his handover speech on Monday Lombard promised to “work on a better distribution of income” and called for more “social justice.”
Lombard will be positioned with junior Minister Amélie de Montchalin, from Macron’s camp, who will have specific responsibility over the budget.
