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Will faster reforms speed up France?

Wednesday, August 20, 2014 - 01:50

France has promised faster reforms and tax breaks as he tries to win back confidence from voters who do not trust he can lift the country out of stagnation. As Ciara Lee reports it will be a hard task.

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The summer holidays are over for the French government. But they probably weren't the best anyway, particularly for Francois Hollande. Relaxing when you are the most unpopular President in French history must be hard. A weekend opinion poll may not have helped either. It showed 85% of voters don't think the government can cut record-high unemployment and only 16% believe it can boost growth. Michael Hewson is from CMC Markets SOUNDBITE: Michael Hewson, Market Analyst, CMC Markets, saying (English): "GDP spend is around 57% of the economy, they can't continue to urge the ECB to take extra measures without taking extra measures themselves" Hollande and his economy and finance ministers were quick to announce new measures. They'll speed up reforms, but at the same time give tax breaks to poorer households. But with tough negotiations looming on the 2015 budget both at home and with France's EU partners it's not going to be easy. SOUNDBITE: Michael Hewson, Market Analyst, CMC Markets, saying (English): "Unfortunately Monsieur Hollande is between a rock and a hard place if he does too much he's gong to upset the left wing of the party and if he does too little he's gong to upset Brussels and Berlin. But I think what is really apparent right now....... France is the sick man of Europe and really he needs to get a grip on taking further measures to try and bring spending under control and try and kick start the French economy." Tax cuts for businesses will remain in place despite an outcry by some Socialists. Sunday trading laws may be "adapted" and closed professions, such as pharmacists, opened up. That's long been a demand from Brussels and one France hopes will convince them to ease up on its deficit targets. Paris risks sanctions if it misses them again. And complaints about the weak euro and a lack of measures from the ECB may this time fall on deaf ears.

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Will faster reforms speed up France?

Wednesday, August 20, 2014 - 01:50

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