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Signature draft law

Andreas Noll / db
February 17, 2015

The French parliament is about to decide on a draft law aimed at boosting growth that would include allowing shops to open more often on a Sunday and a deregulation of some professions.

National Assembly
Image: picture-alliance/dpa/Yoan Valat

The Loi Macron is heralded as a great success, but a success that can only be achieved by taking small steps.

Drawing up the package of measures certainly was a long and stony path: the National Assembly debated the draft law for days, and more than 2,800 amendments were submitted. If it passes, Emmanuel Macron, the young Economy Minister after whom the bill is named, is bound to heave a sigh of relief. France's EU partners have also been waiting for President Francois Hollande to come up with major economic reforms.

Unlike the radical labor reforms Germany pushed through with its Hartz IV benefit system abouta decade ago, France's Loi Macron doesn't come along with elemental change for large parts of French society. There is no mention at all of scrapping the 35-hour working week or large-scale job protection regulations.

Instead, the government focuses on more than 100 individual measures aimed at a step-by-step liberalization in sectors that to a certain degree still enjoy privileges dating back to the French Revolution in the late 18th century.

Some professions - for instance notaries, lawyers and bailiffs - will face more competition in the future. That, and allowing shops to open more often on Sundays, is designed to boost the ailing French economy.

In the third year of Hollande's presidency, France's unemployment figures are still at a record high.

Liberalization and growth

The left wing of the ruling Socialist party was highly critical of the draft law with its more than 200 articles.

Emmanuel Macron
From investment banker to Economy Minister: Emmanuel MacronImage: Reuters/J. Naegelen

The President and parliament took a risk when they approved the Loi Macron bill. Plans to liberalize the country's overregulated, rigid labor market have languished in ministry's desk drawers for years, but efforts at pushing through substantial labor market and social reforms routinely failed in the past. Jacques Chirac in the 1980s, Alain Juppé in the 1990s or Dominique de Villepin after the turn of the century - none of the conservative politicians managed to push through reforms in the face of the protests in the streets.

Even Hollande's predecessor Nicolas Sarkozy, who had the reputation of being a reformer, promptly shelved recommendations by a commission he himself set up.

It's no coincidence that seven years after the experts handed Sarkozy their report, some of the proposals might end up as laws after all. Back then, Macron worked for the chairman of the reform commission. Emmanuel Macron's appointment as Economy Minister last summer was widely regarded as a clear signal that Paris was looking at bolder reform policies. The 37-year-old socialist Economy Minister stands a good chance of reaching his goal.

Principle of the unanimous vote

While unions and trade associations have voiced criticism of the measures, the French people have so far not been protesting in droves.

Stefan Seidendorf
Stefan Seidendorf : "Big step, no revolution"Image: dfi

The sheer number of individual measures makes criticism difficult because the critics are fighting on too many fronts. In addition, the government has refrained from radical steps, opting for a social balance instead.

The provision concerning work on Sundays "allows shops nationwide to open on Sunday and people to work on Sunday - but only after there's been internal agreement, and that includes a say by the worker's council," explains Stefan Seidendorf of the German-French Institute (dfi) in Ludwigsburg.

In addition, lawmakers had quite some influence on the draft legislation, including the institution of a special parliamentary committee.

Pressure to act

The Loi Macron is a big step, but it's no French Revolution, Seidendorf argues.

Many sectors in France are still in need of reform, he says. "Administrations are weighty, France has a complex tax system that could be simplified and much is left to be done concerning the liberalization of the labor market, too."

However, President Hollande and Prime Minister Manuel Valls, both of whom have won approval by the French people as a result of their prudent reaction to the Paris terrorist attacks, are likely to refrain from tackling any other large reform projects.

In any cased, they have their work cut out for them if parliament votes for the bill. Quite a few of the law's articles call for implementing ordinances by the government - and their accurate formulation is bound to spark the next round of political controversy.

According to Seidendorf, the package "contains enough material to fill the remainder of Hollande's presidency with explanations and implementations."

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