France is reviving a more than half-a-century-old tradition of state-lead industrial plans and calling on company executives to help implement them in a bid to rekindle the economy and create jobs.
President Francois Hollande today called on executives from carmakers to software developers and textile manufacturers to help France make 34 new high-tech products, including an electric plane, an ultra-low-energy-consumption car and a faster high-speed train, within a decade. The goal is to recreate the 750,000 jobs destroyed in the last 10 years, Hollande said.
“We can all think of examples from the past, of great industrial plans that came from the top,” Hollande said in a conference at the Elysee Palace in Paris. “It’s not about nostalgia or going back to the 60s... It’s about a state that can accompany and stimulate” business.
Starting in 1946, French governments presented a series of five-year plans to guide the modernization of the country’s postwar economy. While such planning was abandoned in 1993, France’s network of high-speed trains, its extensive use of nuclear power, and Internet-precursor Minitel all resulted from projects funded and directed by successive governments.
The government is earmarking 3.7 billion euros ($4.9 billion) for the latest plan, Le Monde reported. The number wasn’t immediately confirmed by Hollande’s office.
Industrial planning is Hollande’s latest move to battle unemployment, which is at a 14-year high. Since coming to power in May 2012, Hollande has changed labor laws to make it easier for companies to trim staff and cut payroll taxes. He has announced changes to the pension system that will lift the effective retirement age to about 65.
The Socialist president has also pledged to cut public spending over the course of his mandate and promised no new taxes on business in the 2014 budget, to be unveiled Sept. 25.
With Industry Minister Arnaud Montebourg at his side, Hollande today shook hands with entrepreneurs and watched as they demonstrated robots, anti-hacking techniques and 3-D software.
Hollande said in his speech that the European Union and its regulators should help carry his industrial strategy. He called for a competitive policy that makes mergers easier to implement to allow the emergence of “European champions”.
Industry Minister Montebourg has been at the forefront of discussions about re-industrializing France and boosting production. Montebourg last year went on a “Made in France” campaign, posing before the French flag to promote local products. He also made headlines by blocking the sale of Internet-video service Dailymotion SA to Yahoo! Inc. to keep the asset in French hands.
“Following in the tradition of de Gaulle, Pompidou and Mitterrand, we have made a choice to engage in an industrial policy,” Montebourg said in a speech today, citing former French presidents Charles de Gaulle, Georges Pompidou and Francois Mitterrand. “We will trust company executives to implement these plans, so they become more than just words.”
The executives in charge of implementing the state’s plans will work on coordinating innovation, development and production involving companies, startups, research labs and public and private financiers.
France’s plans, with consultant McKinsey’s advice, also include renewable energy, recyclable fabric with new properties and ultra-powerful computing abilities.