Economic nationalism is back in France
France tightened government control over foreign investments in what it says is a move to ensure the 'protection of the country’s interests'.business Updated: May 19, 2014 21:40 IST
France tightened government control over foreign investments in what it says is a move to ensure the "protection of the country’s interests". This comes in the wake of the French government’s opposition to the 12.35-billion euros ($17 billion) bid by General Electric for energy activities of Alstom.
The European Commission has warned France against protectionism but Arnaud Montebourg, the French economy minister, defended the decision, calling it "economic patriotism".
Montebourg, who is famous for having posed for a "Made In France"campaign wearing a traditional striped Breton top and holding a French-made mixer grinder in his hand, is known for his frequent outbursts on protectionist views.
In 2012, when Arcelor-Mittal announced the closure of its furnaces in the west of France, Montebourg had accused Lakshmi Mittal of lying about maintaining French jobs and had suggested that the world’s biggest steelmaker quit France.
Under the new French rules that came into effect on Friday, foreign takeovers in six sectors will be subject to government authorisation: defence, health, energy, transport, water networks and electronic communication.
French apathy to globalisation is not new. In the 1980s, the construction of ‘Disneyland Paris’, was opposed by many who saw it as an American ‘cultural invasion’. Three decades on, the US face of globalisation has been replaced by the fear of a rising domination of emerging economies. Ironically, several French firms such as Carrefour, Total, L’Oréal, and LVMH continue reaping the benefits of globalisation.
In recent years, the anti-globalisation has been replaced by an “alter-globalist" movement, which emphasises environmental protection and ‘economic justice’.
While growth is picking up slowly in Europe, French economy is at zero percent. Pressure is growing on President François Hollande’s government to create jobs and attract investment.