Sarkozy to re-invest sell-off cash into EDF

28th May 2004, Comments 0 comments

PARIS, May 27 (AFP) - French Finance Minister Nicholas Sarkozy vowed Thursday to return part of the proceeds from privatising state energy giant EDF to the company, as tens of thousands of workers marched to protest against government plans to change its nationalised status.

PARIS, May 27 (AFP) - French Finance Minister Nicholas Sarkozy vowed Thursday to return part of the proceeds from privatising state energy giant EDF to the company, as tens of thousands of workers marched to protest against government plans to change its nationalised status.

Sarkozy told French television the state would give EUR 500 million (USD 613.7 million) of the privatisation proceeds to Electricite de France (EDF) to finance its industrial programme.

His comments came after 80,000 workers according to organisers, half that figure according to police, marched in central Paris to protest against the overnment plans for EDF and its gas counterpart GDF.

Unions hired special trains and buses to bring workers from across the country, and the demonstration was joined by supporters from the state rail company SNCF and the airports authority Aeroports de Paris (ADP).

Some 75 percent of the 150,000 staff at the two companies were on strike for the day, according to unions - though management put the figure at 45 percent - and there were localised power-cuts in the Paris outskirts and on the Mediterranean coast.

Last week the centre-right government of President Jacques Chirac approved a bill to transform Electricite de France and Gaz de France (GDF) into limited companies and remove the state protection which they have enjoyed since 1946.

The bill goes before parliament on June 15, when unions have promised another day of action.

The measure has been taken in response to pressure from the European Union, which ruled that their existing status makes the companies in breach of competition rules - benefitting from their unlimited state financial guarantee to operate unfairly in the liberalising European energy market.

However Sarkozy said in the television interview that the state would keep at least a 70 percent stake in EDF, more than previously indicated by the government in its plans to partially privatise the electricity giant.

Sarkozy said the pledge of EUR 500 million to EDF from the partial privatisation was a sign of the government's good faith.

"The government is going to do something that no government has done for 20 years. We are going to take part of the privatisation proceeds, EUR 500 million, to give them to EDF which is going to finance its industrial programme," he said.

"That is truly the proof that basically what we want is the success of this great company," he added.

The step was welcomed by EDF president Francois Roussely, who told AFP that the EUR 500 million were an "important and symbolic element".

Sarkozy has also assured that the public sector status of workers will remain unchanged. Staff enjoy a range of benefits, including job security for life, a special pensions scheme, cheap energy and a works committee, funded by a one percent levy on all fuel bills.

Left-wing parties - and some members of the ruling Union for a Popular Movement (UMP) - support the unions' action. However the left-wing newspaper Liberation admitted Thursday that the protesters have little chance of success.

"They are finding it hard to mobilise opinion. Their own status and notably their pensions are not really in jeopardy, and customers do not care much about a change that will not really affect them till 2007," it said.

2007 is the year when domestic energy supplies in the EU will be compulsorily opened to competition.

© AFP

Subject: French news

0 Comments To This Article