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Ratings firm Fitch Ratings yesterday warned that France's "AAA" rating is threatened by a potential increase in government debt.
Speculations over the increase in the fiscal burden of France began yesterday, after Belgian daily De Standaard informed that the governments in Brussels and Paris are once again discussing the bailout of the "Dexia" group.
"France would have limited room to absorb any new shocks to its public finances without endangering its AAA status - such as a slowdown in growth or new provisions for supporting the banking sector - without endangering its AAA rating", Fitch said.
According to De Standaard, Belgium is trying to determine France to bear a larger portion of the costs of the "Dexia" bailout plan, but the two governments are at odds over the guarantees for the short term borrowing.
"Belgium wanted Paris to guarantee more than had been agreed so far, because France can fund itself at a cheaper rate than our country", De Standaard wrote, without disclosing the source of the information.
In October, "Dexia" was divided by the governments of Belgium, France and Luxemburg, which decided to separate the "bad" assets from the "good" ones, and they granted total guarantees of 90 billion Euros for the next ten years, to help the bank with securing financing.
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