PARIS (MNI) – The French government will attack the problem of
competitiveness in all its aspects, including labor costs, with a
medium-term reform strategy to be launched at the start of November,
French President Francois Hollande said Monday.

After meeting with the directors of the IMF, the WTO, the World
Bank and the OECD, Hollande summarized their views for the press with
the image of a global economy that is losing momentum and threatened by
protectionist reactions.

WTO Director Pascal Lamy underscored the close link between
reinforced competitiveness, growth and job creation, predicting that 90%
of the economic stimulus France could expect over the coming years would
come from trade relations with emerging economies.

Hollande pledged to pursue structural reforms but said that
reducing the public deficit to 3% of GDP next year had priority. Asked
whether postponing this target might allow the government more leeway
for other reforms, he reiterated his commitment to 3% and said any
revisions would have to come from a discussion of all Eurozone members,
which has not happened yet.

Hollande dodged a question on a possible second haircut for Greek
debt, explaining that any decisions would have to wait for the report of
the troika and the next summit of Eurozone leaders next month.

Restoring competitiveness to economy means exploring all sources,
including research, investment, innovation, education, housing “and
labor costs”, he said, but excluded any shock therapy that might weaken
domestic demand during a phase of anemic growth.

“Everything is on the table” for debate and all sides must
contribute and be prepared to make sacrifices, he said, calling on
unions and employers to come up with proposals to reform the financing
of social programs and seek ways to give firms greater flexibility to
adapt to the business cycle, while assuring more security for employers.

All players have need for a stable framework and a clear vision of
the reforms that lie ahead over the course of the next five years, he
said.

–Paris newsroom +331 4271 5540; Email: ssandelius@mni-news.com

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