Sarkozy picks a new CEO of France Inc: himself

Nobody expects total honesty from politicians, particularly on the campaign trail. Still, when the new French president Nicolas Sarkozy promised a ‘rupture’ with France’s past, and even praised Margaret Thatcher for her willingness to ‘break taboos’, you might have expected the pledge to hold good at least for a few months. And yet since assuming the presidency, Sarkozy has shown himself as wedded as any of his predecessors to the traditional French industrial policy of creating sturdy national champions.

He has just engineered the merger of Suez and Gaz de France to create one of Europe’s largest utilities. He has extended France’s influence at EADS, the Franco-German defence and aerospace conglomerate that controls Airbus. And there’s talk of a merger that will bulk up Areva, France’s world-leading builder of nuclear power stations. Forget Thatcherism with a Gallic twist. Sarkozy looks intent on relaunching France Inc., with himself as chief executive. But does that have a hope of success? What other state-sponsored mergers can we expect? And is this really the right medicine for France’s moribund economy?

‘Sarkozy hasn’t changed the traditional French industrial policy,’ said Juan Delgado, a research fellow with the Brussels-based economic policy think tank Bruegel. ‘His promises of more market-based reforms haven’t been in evidence yet.’

Nobody is going to accuse the hyperactive Sarkozy of lacking either energy or ambition. ‘The idea of an industrial policy doesn’t scare me,’ he told business leaders in a speech at the end of August. ‘I won’t put our industry at the mercy of dumping and speculators.’ It might not scare him, but anyone with a slice of Paris’s CAC 40 share index could be forgiven for feeling edgy.