French president defends his economic course | Business| Economy and finance news from a German perspective | DW | 13.11.2012
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French president defends his economic course

French President Francois Hollande has cited economic trends in his country as evidence that his policies are credible. Despite a slump in ratings in his first six months, he said success would emerge within five years.

French President Francois Hollande on Tuesday demanded that the French public judge him long-term on his drive to get the ailing economy back on its feet again and to reverse a 17-month rise in unemployment.

Taking stock of his first six months in office, he told reporters in Paris that decline was not of the country's own making.

"I can understand the doubts that have been expressed," said Hollande who had seen his approval ratings free-falling in recent polls. "But the only valid question in my eyes is not the state of public opinion today, but the state of France in five years," he said.

The Socialist president once again defended a recent move to fund tax rebates for ailing companies with small rise in sales tax, saying the measure would ensure increasing industrial output without choking consumer spending too much.

Berlin-Paris axis intact?

Hollande pointed to lower French bond yields on financial markets, arguing that declining interest rates on sovereign debt sales were a sign of his economic policies becoming "credible."

He urged trade unions and employers to strike a historic compromise in reforming labor contracts with a view to curbing joblessness in the country.

Helping France wriggle out of contraction and narrow a competitiveness gap with Germany are widely viewed as Hollande's biggest challenges on the economic front.

The president denied recent reports in the German media claiming that tensions between Berlin and Paris were rising.

German newspapers had maintained the government in Berlin was highly critical of France's reform pace, but Hollande said relations between the two countries were "good."

French Prime Minister Jean-Marc Ayrault is due to meet with German Chancellor Angela Merkel in Berlin on Thursday.

Three surveys in recent days put approval of President Hollande at between 41 per cent and 44 per cent, down from 58 per cent after his election in May.

hg/ipj (dapd, Reuters, AFP)