Wednesday, June 08, 2005

Guardian Unlimited | "Gallic genius" will save France says Villepin

Guardian Unlimited | Special reports | Gallic genius will save France says Villepin:

France's new prime minister, Dominique de Villepin, refused yesterday to push the country down the road towards free-market reform, saying 'Gallic genius' would help put back on its feet a 'suffering, impatient and angry' nation that has failed to adapt fully to a changing world.

In a speech to the packed lower house of the national assembly, Mr Villepin said his top aim was to cut the country's stubborn 10%-plus unemployment rate and announced €4.5bn (3bn) of extra money to achieve it."

But he insisted that an increasingly heated public debate about the shortcomings of France's high-tax, high-protection social model compared with the more liberal Anglo-Saxon system was irrelevant.

"In a modern democracy, the debate is not between the liberal and the social, it is between immobilism and action," he said. "Solidarity and initiative, protection and daring: that is the French genius."

The part-time poet and former foreign minister added: "My government will be guided by one principle: the imperative of justice; by one criterion: the general interest; by one aim: to improve the lot of every French man and woman."

His speech came as speculation mounted in France over Tony Blair's plans for the British presidency of the EU, which starts next month.

"Tony Blair will try to convince his partners that the policy ... of flexibility and solidarity that has been followed with success in Britain ... can also serve Europe," Le Monde said yesterday, adding that "Blairism" is taboo in France, despite the concrete responses it has offered to unemployment and globalisation.

Mr Villepin said he was convinced France was still committed to Europe and its vote was "not a signal of French isolation". But he acknowledged that the country was at "an exceptional moment in its history" and that his first duty was to "look reality in the face".

France faced a difficult situation, he said: "While the world is undergoing unprecedented change, Europe is divided and the process of adaptation in France is lagging behind ... We have to get this country working again."

Polls showed most French voters rejected the EU treaty in their May 29 referendum because they feared it would lead to more unemployment, and were unhappy with the social and economic situation. Many on the left also felt the constitution enshrined a free-market vision of Europe at odds with France's social ideals.

Most economists believe the key to getting France back to work is reform of the country's inflexible, over-protective labour laws. But France's powerful public sector unions warned the prime minister this week that any attempt to water down jobs legislation would prompt protests.

Mr Villepin said he was setting aside an extra €4.5bn for job creation next year and unveiled a series of steps to boost job creation by small and very small businesses. These include encouraging firms with fewer than 10 workers to hire more people by cutting social charges and paperwork.

He also ordered France's job centres to redouble their efforts to find jobs for the one in four young people who are out of work, and said that penalising the hiring of unemployed workers over 50 would be scrapped. France currently has among the worst unemployment rates in Europe for the under-25s and over-55s.

Among other measures, Mr Villepin announced a major increase in public infrastructure projects such as new railway lines and motorways, and said tax cuts pledged by Mr Chirac in his 2002 election campaign would be suspended to help pay for the job creation measures. "All the spare money in the budget will go on jobs," he said. "All the energy of my government will be thrown into this battle."

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