PARIS--French President Francois Hollande marked the anniversary
of his first year in office by announcing a raft of spending
measures on Monday aimed at shoring up France's anemic economy amid
a sharp decline in his popularity.
Mr. Hollande's government plans to spend 20 billion euros ($26.2
billion) over the next decade, Najat Vallaud-Belkacem, a government
spokeswoman said in a news conference Monday. The funds will
finance a range of public infrastructure projects--revamping roads
as well as power networks--she said without elaborating on the
specifics of the spending program.
The package was timed to counter a collapse in public support
for Mr. Hollande, some analysts say, burnishing his role as a
leader at the helm of the euro-zone's second-largest economy. But
the limited scale of the spending measures--amounting to just 0.1%
of France's annual output--will do little to drive France out of
the economic doldrums.
Mr. Hollande is under intense public pressure to show he can
turn the economy around. He was elected a year ago on campaign
promises to reignite the country's economic growth.
However, the French economy continues to sputter, and recent
polls show that only a quarter of French voters approve of Mr.
Hollande's performance so far. In recent days, Mr. Hollande and his
supporters have rolled out a media campaign aimed at reversing the
public's perception.
On Monday, a documentary of Mr. Hollande's first months in
office was previewed, providing French media with plenty of footage
of the president hard at work. On the same day he also issued a
lengthy statement summing up his achievements over the first year
in office, including his push to overhaul France's rigid labor
market.
"I understand the skepticism of the French. For years they've
been asked to make so many sacrifices from so many governments
without results," Mr. Hollande said.
"The major question facing the French is whether our country can
maintain its rank, its place, its level amid worldwide
competition," he added.
To finance the spending package, Paris will draw upon the 120
billion euros that European Union leaders pledged a year ago to
fund infrastructure projects across the continent, Ms.
Vallaud-Belkacem said.
It is unclear whether France has the fiscal slack to go beyond
the measures that Mr. Hollande's government announced Monday and
propel the country back to economic health. In June, Mr. Hollande
will attend an EU summit where he plans to press German Chancellor
Angela Merkel and other EU leaders to shift the EU's crisis
strategy away from austerity measures, such as tax increases and
public spending cuts that have hobbled the continent's weaker
economies.
Last week, his government secured a two-year extension to bring
its deficit below the EU-mandated limit of 3% of gross domestic
product. The EU expects France's economic output to flatten out
this year, driving up the country's deficit to 3.9% of GDP.
On Sunday, French Prime Minister Jean-March Ayrault said the
government was forging ahead with plans to sell off holdings in
state-backed companies. The proceeds of those planned sales, he
said, will be used to modernize the country and make its companies
more competitive.
The French state has controlling stakes in several companies
such as nuclear technologies group Areva SA, and owns 85% of power
utility Electricite de France. It also owns significant minority
stakes in companies such as Renault SA, France Telecom SA and Air
France-KLM.
In March, the government raised 448.5 million euros from the
sale of 3.12% of the capital of French aerospace supplier Safran,
reducing its stake in the company to roughly 27%. The state has
also cut its shareholding in European Aeronautic Defence &
Space Co. as part of a governance reshuffle agreed with the German
government.
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