Tag: Frances

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France’s structural issues have been uncovered by the pandemic

France's structural problems have been exposed by the pandemic

A couple, one of them on their smartphone, is enjoying the view of the Eiffel Tower at sunset in Paris on February 23, 2021.

Ludovic Marin | AFP | Getty Images

France may still be in the middle of the coronavirus pandemic as the Delta variant is spreading rapidly, but officials and business leaders are looking to a period of recovery and reflecting the broader prospects for France’s political and economic future.

“The recovery is very steep, but even steeper than last year. So we are very happy with it,” said Agnès Bénassy-Quéré, chief economist at the French finance ministry, to CNBC on Sunday, pointing out that the national statistics office is raising its growth forecast for France to 6% in 2021.

“The official forecast for 2021 is still 5% because we are still cautious about autumn. As you said, there is a Delta variant and we kept some restrictions until the end of the year. So already in spring, when this forecast was made, it contained some restrictions, slight restrictions of the second half of the year. So far we haven’t changed that forecast, then we’ll see what happens when we have to do the 2022 budget, “he said, speaking with CNBC’s Charlotte Reed while attending an economic forum in Aix-en-Provence.

Of course, the Covid-19 pandemic has left a lot of devastation and no less in France, where over 5.8 million infections and over 111,000 deaths have so far been recorded, according to Johns Hopkins University.

Like other countries, France put in place emergency measures to support the economy, businesses and employment during the pandemic, and there are now some concerns that reducing that support could lead to job losses and the closure of some businesses.

Bénassy-Quéré said the government has been “very cautious” but the labor market is currently resilient.

“There is a rejuvenation, a gradual phasing out of support, the emergency aid, which comes gradually over the course of the summer. And there will still be some support, for example [the] Long-term unemployment scheme, which also applies in the fall for activities like [the] Aircraft industry where we really want to keep the skills in the industry and so there will be some retraining programs. “

However, he found that while activity in some industries was above pre-crisis levels, some lagged behind, such as tourism. In addition to the uneven recovery, another problem for the government is that France’s mountain of debt has soared to a record high due to huge borrowing. At the beginning of the year, the French statistical office Insee reported that the national debt was 115.7% of GDP at the end of 2020, compared to 97.6% in 2019.

How France will pay off this mountain of debt is uncertain for now, as the government under President Emmanuel Macron will raise taxes just 10 months before the presidential elections. Whether Macron will undertake ambitious (and unpopular) reforms to modernize and simplify France’s sluggish pension system is also uncertain, given the pandemic situation.

So far, two rounds of regional elections in the last few weeks have dispelled expectations that the far-right National Rally – formerly known as the Front National – could do well in the national vote next year after a poor showing in the regions. Turnout was low on both rounds, leading some analysts to express concern about the level of voter dissatisfaction in France.

Valérie Rabault, President of the Socialist Group in the National Assembly, who also attended the Economic Assembly in Aix-en-Provence, told CNBC on Sunday that “French society has broken”, as evidenced by the low turnout in regional votes.

“We had local elections and less than 35% of the people voted, so that’s very low. This was the first time in France that so few people vote in local elections. For me it reflects … a kind of indifference on the part of the population to build a common project for France, for society, and that is the great challenge for us as politicians to be able to and have to tackle this issue [a] more positive message after the crisis, “she said, adding,” We have to define something, a common project that can unite people. “

Structural problems

Business leaders who attended the Aix-en-Provence Economic Forum told CNBC that there were structural problems in France that would not be easy to fix.

“The rifts that existed in French society are still there, be it the territorial divide, the generational divide and the very low percentage of voters as we saw in the last elections,” Pierre-André de Chalendar, Chairman of French building materials group Saint-Gobain, said CNBC on Saturday.

“The priorities are clear, (they are) the energy transition, reindustrialization – which is the best way to overcome this territorial gap – and to place more emphasis on the youth, on education. The question is how do we do it, and I think the problem in France is that the state as a whole is too big and not efficient enough. “

Ross McInnes, Chairman of Safran, agreed that “two important structural issues” should be addressed in France, the most important being the quality of education in France.

“When it comes to education, our school system has let us collectively,” he told CNBC. “Hundreds of thousands of young French people … drop out of secondary school with no good math, you know, the three ‘Rs’ of reading, writing, and arithmetic. And we urgently need to fix that in order to be able to recruit talent for good jobs. “

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Health

France’s Le Maire says peace and safety in danger if African Covid restoration left behind

France's Le Maire says peace and security at risk if African Covid recovery left behind

French Finance Minister Bruno Le Maire on Wednesday warned that peace, security and global stability are in danger if the world’s economic superpowers do not contribute to Africa’s economic recovery from the Covid-19 crisis.

African leaders met in Paris over the past two days in a summit convened by France to strike a multibillion-dollar “New Deal” to aid the continent’s economic and health revival.

The Summit on the Financing of African Economies brought together 21 heads of state from Africa and leaders of continental organizations along with European leaders and the heads of major international finance organizations. In a press conference Tuesday night, French President Emmanuel Macron said the summit had yielded “a New Deal for Africa and by Africa.”

The signatories called for an additional $650 billion of IMF Special Drawing Rights to be released to close the gap between developed and emerging economies. However, only $33 billion of this has been earmarked for African countries and European leaders have vowed to donate their own shares in order to bring the total for the continent close to $100 billion.

The IMF may also contribute some of its gold reserves and in a joint communique after the summit leaders suggested that “flexibility on debt and deficit ceilings” could be used to further alleviate the burden.

G-7 and G-20 urged to contribute

Le Maire indicated on Wednesday that the French government would be pushing for greater contributions from other major economies at the upcoming G-7 (Group of Seven) summit in the U.K. in mid-June, and would also be reaching out to the G-20.

“Developed countries have invested more than 25% of their GDP to fight against the consequences of the crisis and to engage a very strong economic recovery. In Africa, it is less than 2% of their GDP,” Le Maire told CNBC’s Steve Sedgwick, adding that this trajectory risked a great divergence in the recoveries of economies and health care systems.

Workers transport the second shipment of the Johnson & Johnson Covid-19 coronavirus vaccine upon its arrival at the O R Tambo International Airport in Johannesburg on February 27, 2021.

Kim Ludbrook | AFP | Getty Images

“This would be a very important danger not only from an economic point of view, but a real danger for security, for peace, for stability, for illegal immigration, so I really urge everybody to be aware of the current situation of the African countries and to be aware of the necessity of putting more money (into) Africa.”

He suggested that rather than just deploying grants, governments should look to invest in small and medium-sized enterprises, supporting African entrepreneurs who are “at the core of the economic recovery.”

Despite maintaining comparatively low Covid-19 infection and death rates compared to the rest of the world, sub-Saharan Africa is projected by the IMF to have experienced a 3.3% decline in economic activity in 2020, the region’s first recession in 25 years. GDP growth projections for 2021 also lag significantly behind the rest of the world’s 6% estimate.

The drop in activity is expected to cost the region $115 billion in output losses this year and could push another 40 million people into poverty, effectively wiping out five years of progress against poverty.

In Tuesday’s press conference, Macron also set a goal to vaccinate 40% of the population of Africa by the end of 2021, calling the current situation both “unfair and inefficient.”

‘Vaccine apartheid’

The summit has urged the World Health Organization, World Trade Organization and the Medicines Patent Pool to remove intellectual property patents blocking the production of certain vaccines.

IMF chief Kristalina Georgieva cautioned on Tuesday of dire global economic consequences if the vaccine rollout fails in developing countries and the health crisis continues.

South African President Cyril Ramaphosa on Wednesday told France24 that he welcomed the group’s call for major economies in the northern hemisphere to share their vaccine supplies.

“They have a huge surplus and we have no access, and that to me is vaccine apartheid and it can also be characterized as vaccine imperialism,” Ramaphosa said.

“We will never be able to defeat the pandemic, Covid-19, if we try to defeat it in the northern hemisphere only and not in the south.”

A landmark proposal to waive intellectual property rights on Covid-19 vaccines was jointly submitted to the World Trade Organization by India and South Africa in October.

Several months on, however, it continues to be stonewalled by a small number of governments. These include the U.K., Switzerland, Japan, Norway, Canada, Australia, Brazil, the EU and — until recently — the United States.

Categories
World News

Can France’s Far Proper Win Over the ‘Beavers’? One Mayor Reveals How

Can France’s Far Right Win Over the ‘Beavers’? One Mayor Shows How

Mas Llaro had always voted for mainstream law.

But disaffected and tired of the status quo, the Talaus, like many others, voted for the far-right party for the first time last year, attracted by Mr Aliot’s emphasis on cleanliness and crime, and said their apartment had been broken into twice.

Despite being pleased with the mayor’s performance, Mr Talau said he will still join the far-right dam in next year’s presidential contest and hold his nose to vote for Mr Macron. But Ms. Talau was now considering casting a ballot for Ms. Le Pen.

“She put water in her wine,” said Ms. Talau, adding that Mr. Macron was not “hard enough”.

Mr Aliot’s opponent in 2014 and 2020, a center-right politician named Jean-Marc Pujol, had pushed his way to the right in an unsuccessful move to fend off the far right. He increased the number of police officers and, according to the government, gave Perpignan the highest number per capita in any major city in France.

Even so, many of his key far-right supporters appeared to have more faith in crime and were still defected, while many left-wing beavers complained that they had been ignored and refused to participate in dam construction again, said Agnès Langevine, who represented them Greens and the Socialists in the 2020 mayoral elections.

“And they told us, ‘In 2022, when it’s between Macron and Le Pen, I won’t do it again,'” she added.

Mr Lebourg, the political scientist, said Mr Aliot had also won over higher-income conservative voters by adopting a general economic message – the same strategy that Mrs Le Pen followed.