The French Minister for the Economy and Finance, Mr Hervé Gaymard, yesterday held his first press conference since taking office at the end of last year.
A loyalist to President Jacques Chirac, Mr Gaymard explained "the broad orientations of French economic policy for the next 30 months" - corresponding to the remainder of Mr Chirac's term in office.
In recent weeks, France has seen street protests against diminishing job security and attempts to roll back the 35-hour working week. Mr Gaymard said there was a need to reconcile social and economic policy. "I want to build a society of solidarity and liberty, which I would call Soliberté," he said. The three objectives of creating employment, growth and confidence were inseparable, Mr Gaymard continued.
For the first time in four years, the French economy created 30,000 jobs last year. Yet unemployment remains at nearly 10 per cent. Economic growth was about 2.4 per cent in 2004, Mr Gaymard said. "This is an excellent result. Our growth and consumption rate are double those of the euro zone." He hoped that growth would be 2.5 per cent this year.
France is the world's fifth-largest exporter, the fourth-largest exporter of services and the third-largest recipient of direct international investment, Mr Gaymard said. "Our social protection system is one of the best in the world." Yet paradoxically, "for a long time we have not truly had confidence in the future".
The minister announced a number of consumer-friendly measures intended to pump money into the French economy.
In 2002 President Chirac promised to reduce income tax by 30 per cent in five years. Although reductions have been uneven, Mr Gaymard asserted that the government was nearly halfway there. Mr Gaymard promised to reduce income tax further in 2006 and 2007, especially for the middle classes.
The previous finance minister, Mr Nicolas Sarkozy, allowed parents and grandparents to give up to €20,000 to their children and grandchildren tax-free. Mr Gaymard has extended the measure until December and raised the ceiling to €30,000.
Next month, French banks will be allowed to pay interest on current accounts. Mr Gaymard said he would lower rents by making it easier for landlords to collect insurance on unpaid rent, and by lowering the construction index upon which rents are based.
Mr Gaymard also announced a timetable for the privatisation of state-owned businesses. Autoroutes du Nord et de l'Est will be floated in April, Gaz de France before the summer, AREVA by the end of summer and Electricité de France by the end of the year.
