Monday

5th Dec 2016

Hollande: '€30 billion must be found'

French Socialist President Francois Hollande has outlined a two-year plan to overhaul the country's stagnating economy and to boost employment.

The President conceded the task ahead to stimulate growth and restore public finances would be formidable, but promised in a live TV address on Sunday (9 September) to achieve results by 2014.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

  • French president Hollande outlined his plans on TV on Sunday (Photo: Francois Hollande)

"My mission is a recovery plan and the timeframe is two years," he said.

The country's hope of 1.2 percent growth for 2013 was recently dashed as figures indicated the economy will probably expand by just 0.8 percent next year.

With unemployment passing 10 percent for the first time since 2002 and increasing, the French leader tried to persuade the public that an increase in taxes would help lower the budget deficit to 3 percent of GDP in 2013.

"Thirty billion [euros] must be found," said Hollande.

He added that all the ministries, with the exception of education, security and justice, would have to reduce their costs by a total of €10 billion. Companies will contribute an additional €10 billion in taxes, with the remaining €10 billion levied on households.

Tax the rich

He also reaffirmed a new 75 percent tax on people earning more than €1 million a year, reportedly causing a stir among some of France's wealthiest.

The tax would affect between 2,000 to 3,000 people.

On Saturday, France's richest individual, Bernard Arnault of the luxury goods consortium LVMH, said he would apply for Belgian dual citizenship, according to the Belgian daily, La Libre Belgique.

Arnault says his decision has nothing to do with the 75 percent tax and that his fiscal homestead would remain in France.

Hollande on TV noted there would be no exceptions on the wealthy and said: "He [Arnault] must weigh up what it means to seek another nationality because we are proud to be French."

France's economy has failed to expand in the past three quarters and just over 3 million people are now unemployed.

In August, troubled car-maker Peugeot Citroen announced it would cut some 8,000 jobs in the country, with labour unions threatening widespread strikes if the government does not intervene.

Hollande said he would reverse the unemployment curve by 2014 and promised to create an additional 100,000 new jobs before the end of the year.

His government will also pressure businesses and unions to quickly reform the labour market. Should the two fail to put forward viable proposals that would offer greater worker protection but allow companies to be more flexible in hiring and firing, he said his government would intervene to impose the labour market reforms itself.

Analysis

Doubts hang over EU investment plan's future

Questions of value for money and a lack of transparency complicate adding almost €200 billion more and extending the Juncker investment plan to 2020.

News in Brief

  1. EU dismisses euro crisis risk after Italian referendum
  2. Italy result poses no risk to the EU, Sapin says
  3. EU asked to clarify links to Iran executions
  4. Italian economy minister tipped as caretaker PM
  5. EU tells US tech giants to act faster against hate speech
  6. Iceland's Pirates in bid to form government
  7. Danes are the happiest workers, study says
  8. Talks on wholesale roaming rules to start

Stakeholders' Highlights

  1. CESICESI Congress Focuses on Future of Work, Public Services and Digitalisation
  2. European Gaming & Betting AssociationAustrian Association for Betting and Gambling Joins EGBA
  3. ACCAWomen of Europe Awards: Celebrating the Women who are Building Europe
  4. European Heart NetworkWhat About our Kids? Protect Children From Unhealthy Food and Drink Marketing
  5. ECR GroupRestoring Trust and Confidence in the European Parliament
  6. UNICEFChild Rights Agencies Call on EU to put Refugee and Migrant Children First
  7. MIRAIA New Vision on Clean Tech: Balancing Energy Efficiency, Climate Change and Costs
  8. World VisionChildren Cannot Wait! 7 Priority Actions to Protect all Refugee and Migrant Children
  9. ANCI LazioRegio-Mob Project Delivers Analysis of Transport and Mobility in Rome
  10. SDG Watch EuropeCivil Society Disappointed by the Commission's Plans for Sustainable Development Goals
  11. PLATO15 Fully-Funded PhD Positions Open – The Post-Crisis Legitimacy of the EU (PLATO)
  12. Access NowTell the EU Council: Protect our Rights to Privacy and Security