Press Release

DBRS Morningstar: How French Regions' Finances Stand Ahead of the 2021 Regional Elections

Sovereigns, Sub-Sovereign Governments
November 25, 2020

DBRS Morningstar released a commentary looking at the financial position of French regions ahead of the upcoming 2021 regional elections.

Due to the Coronavirus Disease (COVID-19) pandemic, French regional elections are now likely to be postponed to June 2021 from an initial vote planned for March 2021. The vote will mark the end of the current regional mandate that started in December 2015 and saw the central government implement important institutional changes for regions. Most notably, France’s mainland regions were merged into 13 regions from 22 previously, from January 1, 2016; new transport responsibilities were transferred to regions in 2017 and 2020 saw the reduction of regional responsibility for apprenticeships.

DBRS Morningstar considers that not only did the regions manage well the institutional changes implemented thus far, but most of the sector was able to strengthen its financial position through budgetary consolidation.

Thanks especially to their strong grip over operating expenditure and strengthened budget control, French regions were able to increase their consolidated operating results by 35% between 2015 and 2019 versus almost 25% for the whole French sub-sovereign governments (SSGs) sector. “During that timeframe, four regions have been able to increase their operating results in nominal terms by more than 50%” says Mehdi Fadli, Vice President at DBRS Morningstar.

The level of capital expenditure, excluding the management of EU funds, remained very high. On average, annually incurred capex reached EUR 8.6 billion during the 2016-19 period, 1% higher than the 2010-15 average, and close to one-third of their total expenditure. Six regions were able to increase their annual level of capex by more than 6%.

Thanks to the improvement of their operating results, the majority of French regions were able to maintain this high level of capex while limiting their debt accumulation. Their stock of long-term debt increased by around 3% annually during the 2016-19 period versus 7% annually over the previous mandate. Some regions even managed to slightly reduce their debt stock between 2016 and 2019. “French regions have managed to keep a very sound debt ratio over the last four years. This places them on a strong footing at the start of a new mandate to face the economic, financial and social consequences of the COVID-19 pandemic” says Nicolas Fintzel, Vice President at DBRS Morningstar.

The commentary titled: “French Regions: Financial Snapshot Ahead of the 2021 Regional Elections” is available at

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