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From Birmingham 1998 to Köln 1999.

France

~ France Contents ~ Country Objectives ~

Political Data
Head Of State: President Jaques Chirac
(RPR; since May 1995)
Head of Government: Prime Minister Lionel Jospin
(PS; since June 1997)
Minister of Economy, Finance and Industry: Dominique Strauss-Kahn (PS)
Minister of Foreign Affairs: Hubert Vedrine (PS)
Minister of Trade: Jaques Dondoux (PS)
Minister of Town and Country Planning and Environment: Dominique Voynet (Verts)
Minister of Justice: Elisabeth Guigou (PS)
Minister of Employment and Solidarity: Martine Aubry (PS)
Minister of Defence: Alin Richard (PS)
Sherpa: Jean-David Levitte
Sous-Sherpa: Dominique Perraud
Political Director: Gerard Errera
Government

Cabinet: Council of Ministers appointed by the President on the suggestion of the Prime Minister

Legislative Branch: Bicameral Parliament, which consists of the Senate (321 seats) and the National Assembly (577 seats)

Political Parties forming the Government: Partie Socialiste (PS); Partie Communiste Francais (PCF); Verts

Opposition Parties:

Rassemblement pour la Rebublique (RPR)
Union pour la democratie francaise (UDF)
Partie radicale socialiste (PRS)
Mouvement des citoyens (MDC)
Front national (FN)
 


Economic Data
Gross Domestic Product (GDP) (1998): (1997) $1.3 trillion
Population 58,732,965
GDP per Capita: $24,544 (US dollars)
Economic Growth Rate: 3.2%
Inflation: 0.5%
Unemployment rate: 11.5%
Current Account Surplus 35.0 US$ billion
Trade Surplus NA
Foreign Direct Investment NA
Budget Deficit (1997) 2.7% of GDP
Government Debt (1997) NA
Foreign Aid as a % of GDP 0.45 (ODA % of GNP)
Total export value 3 major exports (1998): passenger cars, spare parts & equipment for vehicles, components for aircraft
3 major exports:

passenger cars,
crude oil,
information technology equipment

Main destination of exports:

Germany
Italy
United Kingdom

3 major imports:

Investment goods
Chemicals
Non-durable consumer goods

Issues for France

Introduction

The French economy is continuing its gradual recovery from a period of stagnant growth. Last year's economic growth of 3.2% was a record for the 1990s. Between 1990 and 1997, economic growth had only averaged 1.2%. Although the economic upturn, driven by strong domestic demand and growing consumer confidence, is beginning to slow down, economic growth is expected to reach a robust 2-2.5% this year. The French economy is currently outperforming that of Germany. Last year, 400,000 jobs were created. However, structural unemployment remains high at 10%. President Chirac is enjoying record-high approval ratings of 79%, due in large part to his handling of the situation in Kosovo and his successful navigation of cohabitation. Therefore, a rejuvenated President Chirac will be well-placed to take a lead role in G-8 discussions.

Unemployment and Job Creation

The French government's top priority remains combating the country's high unemployment rate, particularly among its youth. Some advancements have been made in this area. The unemployment rate has decreased from 12.6% in the summer of 1997 to the current rate of 11.5%. However, structural problems such as the heavy cost of social security charges levied on employers and labour market rigidities have kept structural unemployment fixed at 10%. A government report released in April predicted that workers will have to work longer hours and retire later in order to avoid exhausting the pension system. State pensions currently absorb 12% of GDP.

The 35 hour work-week initiative for reducing unemployment which was adopted in 1998 has not reached full implementation as of yet (the policy takes effect on January 1, 2000 for larger businesses). The policy has had little effect on the 21% unemployment rate among youth. Last year, the French government developed a project aimed at providing 350,000 public sector jobs for youth. To date, this project has been successful but is still in its infant state and has only attracted a limited number of company participants. Martine Aubry, the employment and social affairs minister once predicted that the 35 hour work-week would help create more than 1 million jobs. Initial results have been far more modest. Only 24,000 jobs have been created or saved as a result of the program. In its latest report on France, the OECD said that the 35-hour work week offers “considerable risks” and “uncertain dividends”.

Talks have begun on extending the 35 hour work-week policy to the previously exempt 4.5 million public sector workers who enjoy extensive perquisites such as near-total job security, longer holidays, larger pensions and better health coverage. The implementation of this ambitious plan to cut the work hours of public workers by 10% without a reduction in salary will prove to be extremely difficult.

Previously at the EU Summit in Cologne on June 3rd and 4th, the governments signed an “employment and jobs pact” which contains guidelines for curbing unemployment and stimulating job-creation. President Chirac will build upon this effort in Köln to develop more strategies and elicit even greater co-operation on this pressing social and economic problem.

Development in Africa/Debt Forgiveness

France's traditional ties to developing countries in Africa, the Pacific and the Caribbean continue to influence its foreign policy agenda. Although France's foreign aid contributions continue to decline, in 1998, France led all seven industrialized G-8 members in terms of relative development assistance contributions. During the past year, French official development assistance levels reached over 37 billion francs which represents 0.45% of its GNP and accounted for over 13.34% of worldwide ODA.

France is attempting to modernize its relations with Africa not only in the political and military sphere, but also in terms of encouraging democratization and strengthening the rule of law. In June of 1998, President Chirac visited four southern African countries. France continues to emphasize good government and well-targeted resources as important tenets to any effective development strategy. In 1998, the French government devoted 180 million francs to its RECAMP project which aims at strengthening African peacekeeping capacities

France's leading position among donor countries is an important instrument for strengthening its ties with other Francophonie member states and augmenting French influence in the developing world, particularly in Africa. In order to counteract US efforts to increase its influence in the region, the French government will continue to assume a principal role in Summit talks on assistance to the poor. These discussions are certain to include the timely issue of debt forgiveness, a subject which France has worked to keep high on the international agenda in past years. As a major creditor nation, France will try to encourage burden sharing by other members of the G8..

Kosovo

Although France withdrew from NATO's military command structure in 1966, it has participated with the alliance in the bombing campaign against Serb forces. France has contributed the largest number of European fighter aircraft and placed them under American command. France has also participated in negotiations as a member of the Contact Group and through its continued involvement in peace talks. Furthermore, the French government has already agreed to assist in monitoring and peacekeeping efforts in the region once the conflict has been diffused. France, along with its NATO partners, is committed to continuing the bombings until President Milosevic agrees to all of the alliance's conditions, including the withdrawal of Serb forces from Kosovo, the return of refugees, the establishment of substantial autonomy for the province and the deployment of a peacekeeping force under the auspices of the UN.

France, along with Germany and Italy remains unreceptive to the idea of military engagement. In a speech delivered to the National Assembly on April 27th, Prime Minister Jospin stated that ground intervention meant “risking a Balkan-wide conflagration” and “jeopardizing relations with Russia”, whose assistance is vital for a political settlement to the crisis. Therefore, France will attempt to discourage British calls for the deployment of ground troops and will continue to encourage a multilateral approach to the crisis in Kosovo. It is hoped that a diplomatic breakthrough leading to a ceasefire might be achieved at the G-8 Summit.

Prepared by Suzanne Murphy and Thalia Lidakis, University of Toronto G8 Research Group, June 1999

~ France Contents ~ Country Objectives ~

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