France’s President Emmanuel Macron outlined his agenda to create a more competitive France and address the concerns of many French citizens on globalization. He told participants at the World Economic Forum Annual Meeting: “The objective is very simple and straightforward – make France more competitive, more innovative, in order to finance … a fair system.”
“France has been very much affected by structural change and its relationship with globalization. I have to fight with a nationalist party because there are many fears in my own country – because we didn’t deliver properly,” said Macron. “Some people think the solution is to get out of globalization. And that gives me a special responsibility of building a France that is open to the rest of the world, and standing beside those who have been forgotten and left behind by globalization – and to show that it benefits the middle and lower classes.”
Macron outlined to participants the five pillars of his reform plan: education, investment and capital, acceleration and flexibility, fighting climate change, and what he called “cultural change”.
He pledged €15 billion over the next five years to train and reskill workers. He urged special attention to the education of women, not just in France but globally, noting that women make up two-thirds of the over 750 million people who don’t possess basic literacy skills.
Under the rubric of investment and capital, Macron highlighted France’s corporate tax rate cuts and capital gains tax refunds, measures, which he said, have accelerated France’s recovery and “reinforced France’s attractiveness”.
Macron defined acceleration and flexibility in terms of realigning France “on Germany and Northern Europe”, shifting from “rules defined by law” towards rules “defined by consensus” and by reducing total costs associated with energy, housing and transport to make the French economy more nimble and responsive.
The French president said he would “make France a model in the fight against climate change” his fourth pillar, and announced his intention to close all coal-fired power plants in France by 2021.
Attributing France’s penchant for regulations, laws and taxes to something rooted in French culture, Macron said that in the past six months his administration has worked “like crazy” to reduce the number of regulations. He underscored the importance of visibility as critical to guaranteeing predictability, and thus stability. France, he said, is a “nation of entrepreneurs”, but cultural norms raise obstacles to entrepreneurship.
Now, however, with his reform agenda under way, “France is back – back at the core of Europe. Because we will never have French success without European success. All of these initiatives and reforms have a natural counterpart, which is European strategy.”
He went on to say: “If we want to avoid fragmentation of the world, we need a stronger Europe. It’s absolutely key. In my view we have to redesign a 10-year strategy to make Europe an actual economic, social, green, scientific and political power.”
Macron also called for a more robust International Monetary Fund with a broader mandate that would include regulatory authority over parts of the financial system that currently escape regulation – including cryptocurrencies and the shadow banking system.
He voiced concern over the ability of large tech firms to avoid effective taxation and regulation. “At what point are we going to stop innovation?” he asked, noting the potential for unfettered tech companies to do substantial damage to social interests.
Macron also expressed concern over the “race to the bottom” between countries competing for corporations and the jobs they create through ever-lower corporate tax rates. “We need to renounce unbridled tax optimization,” he said.
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