France’s Sarkozy hints at bigger state role in business, encourages bank lending
The Associated Press published a piece talking about French President Nicolas Sarkozy’s plans to convince bank leaders to lend more to businesses:
Sarkozy signals bigger role for state in business
By EMMA VANDORE (AP) – 2 days ago
PARIS — French President Nicolas Sarkozy is bent on taking a bigger role in the running of French companies, summoning bank leaders to his Elysee palace on Friday to order them to boost lending to the economy and smaller companies.
Sarkozy — whose conservative party faces regional elections later this month that polls show favor the opposition Socialists — “asked banks to remain fully mobilized to finance the economy in the recovery that is starting,” a statement issued by his office said.
“He particularly insisted that small and very small companies have access to credit,” it said.
France has also been setting the rules over how banks operating in France award bonuses, justifying the intervention by saying it pumped billions of euros in state aid into banks at the height of the global financial crisis.
When he came to power in 2007, Sarkozy was meant to shake up the stagnant, interventionist French traditions and bring back the French bankers who had jumped across the English Channel for lucrative jobs in London. He embraced the American entrepreneurial spirit and pledged to free up mortgage lending and hiring and firing.
Now, he’s reverted to France’s traditional state-central tendencies and has become one of the foremost cheerleaders for a new global economic order that will rein in the perceived excesses of the free market.
On Thursday, he announced a revamp of his industrial policy, saying that he wants board members in state-owned companies to represent government interests.
The government is the majority shareholder in Electricite de France, nuclear engineering giant Areva, and Aeroports de Paris. It also has stakes in France Telecom, Air France-KLM, GDF Suez, and Renault among other companies.
Earlier this year Sarkozy summoned Renault CEO Carlos Ghosn for an assurance that he wouldn’t switch production of the popular new generation Clio cars from France to Turkey. He complained about carmakers who produce abroad, saying they “no longer have a nationality.”
On Thursday, he said the government will “completely overhaul its shareholders’ role” and be represented by two administrators in companies where it owns shares. He said he wants twice-yearly exchanges with these companies on their strategy, investments and results.
Associated Press writers Thibault Leroux contributed to this report.
Copyright © 2010 The Associated Press. All rights reserved.