France faces down socialism

France’s socialist government has forced through controversial economic reforms.

France's socialist government has finally shown it means business when it comes to raising the economy's long-term growth potential.

Fearing a defeat at the hands of rebellious socialists and opportunistic centre-right MPs in the lower house of parliament, it has rammed a reform package through by using a rarely invoked constitutional clause that allows an administration to send a bill straight to the senate.

Talk about an uphill struggle, says The Times. "Wars have been launched with less discussion." Yet in truth, the new measures are pretty modest.

The law extends the number of Sundays that shops may stay open from five to 12 per year; allows intercity coaches to compete with railways; lifts barriers to becoming a notary (a highly protected field); and speeds up labour-tribunal hearings.

The package is a start, reckons Pierre Gattaz, head of MEDEF, the employers' association, but to give France's stagnating economy a jolt, "we need five to ten such reforms". Bolder labour-market changes would be particularly helpful, says Capital Economics.

But the clause the government used can only be invoked once a year, and opposition to change is strong. This is a step in the right direction, but more pervasive change will take some time.

Recommended

How the Covid-19 vaccine crisis is putting the EU in danger
EU Economy

How the Covid-19 vaccine crisis is putting the EU in danger

The botched coronavirus vaccine campaign will cause long-term harm to the EU's economy, says Matthew Lynn.
4 Apr 2021
How the vaccine wars will harm us all
Global Economy

How the vaccine wars will harm us all

Grabbing and hoarding vaccine supplies, or even manufacturing one’s own, might seem to make sense for a state in an emergency. But the damage done to …
27 Mar 2021
The European Central Bank fumbles its way towards yield curve control
EU Economy

The European Central Bank fumbles its way towards yield curve control

The EU’s economic recovery is faltering, but its bond yields keep rising. That makes things tricky for the European Central Bank, says John Stepek. He…
12 Mar 2021
Vexing vaccine delays hit drug firms
Biotech stocks

Vexing vaccine delays hit drug firms

AstraZeneca and Pfizer are being attacked by the EU over what it claims are delays in delivering the Covid vaccine.
28 Jan 2021

Most Popular

Central banks are rushing to build digital currencies. What are they, and what do they mean for you?
Bitcoin

Central banks are rushing to build digital currencies. What are they, and what do they mean for you?

As bitcoin continues to soar in value, many of the world’s central banks are looking to emulate it by issuing their own digital currencies. But centra…
8 Apr 2021
Nuclear power might never be popular – but now looks a good time to invest
Commodities

Nuclear power might never be popular – but now looks a good time to invest

Nuclear power gets a very bad press, but it is the ultimate renewable energy source. Interest in it is perking up again, says John Stepek. Which means…
9 Apr 2021
House prices: from boom to even bigger boom
House prices

House prices: from boom to even bigger boom

UK house prices have risen to new to record highs, says Nicole Garcia Merida. Demand continues to outpace supply, but continued low interest rates, th…
9 Apr 2021