France maps a path through globalisation
Saturday, 15 September 2007
Ben Hall
TOUGHER regulation of hedge funds, protection of strategic industries and the creation of European industrial champions are essential if the French are to be reconciled with globalisation, according to a report commissioned by President Nicolas Sarkozy and published recently.
In his study, Hubert Wdrine, a former Socialist foreign minister, urged his compatriots to ditch the "persistent distrust" and "constant pessimism" with which they regard France's place in a globalised world.
France had many strengths that would allow it to flourish in the global economy, but there would also be losers who had to be helped. So if there was to be national consensus, there would have to be much greater protection, regulation and redistribution by the French government and the European Union, he said. Protection was not necessarily the same thing as protectionism.
Mr Wdrine complained that pro-globalisation governments accepted the need for financial regulation but had "not been demanding enough" in recent years, as this summer's financial crisis had shown.
He urged Mr Sarkozy to join German efforts to impose higher standards of transparency on hedge funds and highlighted the opaque nature of sovereign funds, such as those controlled by certain Gulf states.
Germany has been pushing for a code of conduct among the Group of Eight industrialised countries, but its efforts have been rebuffed by the US and UK.
Mr Wdrine said joining forces with Germany on this and other ways of regulating globalisation would help reinvigorate the Franco-German relationship and give fresh impetus to the EU.
He also called on the EU to be far more robust in applying the principle of equal access in trade deals and to stand ready to protect its industry from hostile takeovers, particularly where there was not equal access. The EU should consider more widespread use of golden shares to block hostile takeovers or otherwise simply choose to designate certain industries as of "strategic" importance.
Some of his proposals were more radical and sketchy. One way of redistributing the gains of globalisation would be somehow to tax industries that benefited from exchange-rate stability under the euro in order to help those that had lost out, he suggested.
If Europe was not more hard-headed about protecting itself, there was a risk that its well-meaning liberal leaders would eventually be seen as the "idiots of the global village", he added.
The Elysee declined to comment on the report, saying it would take time to digest its contents.
........................................
FT Syndication Service
TOUGHER regulation of hedge funds, protection of strategic industries and the creation of European industrial champions are essential if the French are to be reconciled with globalisation, according to a report commissioned by President Nicolas Sarkozy and published recently.
In his study, Hubert Wdrine, a former Socialist foreign minister, urged his compatriots to ditch the "persistent distrust" and "constant pessimism" with which they regard France's place in a globalised world.
France had many strengths that would allow it to flourish in the global economy, but there would also be losers who had to be helped. So if there was to be national consensus, there would have to be much greater protection, regulation and redistribution by the French government and the European Union, he said. Protection was not necessarily the same thing as protectionism.
Mr Wdrine complained that pro-globalisation governments accepted the need for financial regulation but had "not been demanding enough" in recent years, as this summer's financial crisis had shown.
He urged Mr Sarkozy to join German efforts to impose higher standards of transparency on hedge funds and highlighted the opaque nature of sovereign funds, such as those controlled by certain Gulf states.
Germany has been pushing for a code of conduct among the Group of Eight industrialised countries, but its efforts have been rebuffed by the US and UK.
Mr Wdrine said joining forces with Germany on this and other ways of regulating globalisation would help reinvigorate the Franco-German relationship and give fresh impetus to the EU.
He also called on the EU to be far more robust in applying the principle of equal access in trade deals and to stand ready to protect its industry from hostile takeovers, particularly where there was not equal access. The EU should consider more widespread use of golden shares to block hostile takeovers or otherwise simply choose to designate certain industries as of "strategic" importance.
Some of his proposals were more radical and sketchy. One way of redistributing the gains of globalisation would be somehow to tax industries that benefited from exchange-rate stability under the euro in order to help those that had lost out, he suggested.
If Europe was not more hard-headed about protecting itself, there was a risk that its well-meaning liberal leaders would eventually be seen as the "idiots of the global village", he added.
The Elysee declined to comment on the report, saying it would take time to digest its contents.
........................................
FT Syndication Service