France chided ahead of controversial reform unveiling

7th December 2014, Comments 0 comments

Crisis-hit France was urged Sunday by Germany and its own Nobel prize-winning economist to reform, days before Paris prepares to unveil a controversial set of measures to unblock its stagnating economy.

More Sunday trading for shops, opening up national bus routes and throwing open traditionally closed professions such as notaries and chemists: the reforms due to be revealed on Wednesday have already sparked fierce opposition within France.

Emmanuel Macron, the 37-year-old former Rothschild-banker turned economy minister, has insisted the reforms are needed to "clear away the rigidities, lift the blockages, the glass ceilings and to allow our economy to function better, to flow better".

And with just days to go until the measures are unveiled, German Chancellor Angela Merkel, who has been at the forefront of efforts to force down budget deficits she sees as the cause of the eurozone debt crisis, launched a broadside at Italy and France for reforming too slowly.

The European Commission was "justified" in giving both countries more time to reduce their fiscal red ink "because both countries are in the process of carrying out reforms," Merkel told the Welt am Sonntag weekly.

"But the Commission has also said in a clear manner that what is on the table to date is still insufficient. That's something that I agree with," she added.

Brussels has also criticised the "limited progress" made by France in implementing reforms to get the economy moving.

Paris also found itself being chided by Jean Tirole, the French 2014 Nobel Economics laureate, who said France "should follow the example of countries like Germany and Sweden, which had difficult times and carried out a lot of reforms".

"We should carry out reforms to put people back to work... and also reform the state as many countries have done," Tirole told a news conference in Stockholm

France, Europe's second largest economy, is in dire need of a boost. Gross domestic product inched up 0.3 percent in the third quarter of the year and unemployment stubbornly refuses to come down from record levels.

Figures published on Friday showed unemployment in France stood at 10.4 percent in the third quarter and President Francois Hollande has said he will not stand for re-election if the jobless queues continue to grow.

France, one of the founding members of the European Union, also finds itself under fire from Brussels over its budget deficit, which is due to remain above the three percent of GDP limit until 2017.

- Open all hours -

One of the cornerstones of Macron's reforms is permitting the retail sector to open shops on Sundays, in a bid to spur much-needed consumption.

Town halls would be allowed to grant trading licences on 12 Sundays a year, compared to the current five Sundays annually.

In addition, local officials would have to grant five Sundays a year whereas they can now decide to grant none.

In touristic areas and certain busy stations, the laws would be relaxed still further.

But the proposed changes, especially attempts to deregulate historically closed sectors of the economy such as notaries, have already sparked fury.

Notaries joined forces with doctors and pharmacists in an unusual strike and demonstration in September, showing the uphill battle Hollande and Macron have ahead of them.

This battle is expected to be fierce even within their own ruling Socialist Party, with the left wing of the group calling for a vote against the package which they see as too business-friendly.

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© 2014 AFP

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