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R 111604Z SEP 06
FM AMEMBASSY PARIS
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INFO RUCNMEM/EU MEMBER STATES COLLECTIVE

UNCLAS SECTION 01 OF 02 PARIS 006082 
 
SIPDIS 
 
SENSITIVE 
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E.O. 12958: N/A 
TAGS: ECON EIND EINV ETRD ELAB PGOV FR
SUBJECT: EMPLOYERS UNION BOSS SAYS FRANCE AT AN INFLEXION POINT 
 
 
¶1. (U) Summary: In a September 6 off-the-record breakfast MEDEF 
(French employers union) President Laurence Parisot told a group of 
business leaders and opinion makers that France was at a turning 
point.  In a session that ranged from the Doha trade round, to 
relations with labor unions, to France's upcoming presidential 
elections Parisot said the choices facing France today would 
determine whether it went down the road of progress or "poverty." 
End summary. 
 
¶2. (U) At an informal September 6 gathering of business and 
political leaders (sponsored by the weekly L'Express) MEDEF 
president Laurent Parisot said she was "optimistic" coming off 
MEDEF's "summer university" that had featured EU President 
Jose-Manuel Barroso.  Barroso had told the MEDEF gathering that 
France was a champion of globalization "without knowing it."  But 
Parisot said Barroso's message that EU member states were "equals in 
dignity" had also been a useful dose of humility for a French 
audience that has difficulty reconciling ambitions to lead Europe 
with the reality of its inability, at times, to do so. 
 
¶3. (U) In opening remarks focused on Europe, Parisot said she put 
considerable stock in the EU's Lisbon agenda.  MEDEF will embark on 
an informational campaign to familiarize France's business class and 
entrepreneurs with its content.  Parisot said she would also ask the 
GOF to appoint a "Monsieur/Madame Lisbon Agenda" -- someone with 
sufficient gravitas to raise the visibility of the Agenda in France 
and help shepherd reform.  "(Lisbon) is a political ambition, it 
needs to be known by the public." 
 
¶4. (U) On France's upcoming presidential election Parisot said MEDEF 
could live with "a market economy of the right or left, as long as 
it's a market economy."  MEDEF would prepare a "white book," to be 
issued in November, outlining what it sees as key issues facing 
France.  Parisot said MEDEF plans to be "very present" in the 
campaign and had established several internal commissions to develop 
policy recommendations -- and remind all candidates of the French 
business community's policy priorities. 
 
¶5. (U) Among chief concerns, Parisot enumerated reform of the 
collective bargaining system, reform of the unemployment system, and 
educational reform.  On the first point Parisot said she would 
welcome stronger membership in French labor unions as a means of 
creating more reliable "social partners" for French business.  An 
excessive state role in the bargaining process reduced the incentive 
for workers to look out for their own interests, Parisot thought. 
MEDEF supported constitutional reform that would reduce the role of 
the state and give businesses and their "social partners" the right 
to bargain and establish employment contracts directly. 
 
¶6. (U) Parisot bemoaned the discourse of "class warfare" favored by 
some unions, calling it completely out of touch with today's 
economy.  In informal conversation she could find common ground with 
union leaders on the changing nature of employment in a 21st century 
economy.  But getting agreement to anything on paper was impossible, 
she said.  But Parisot stopped short of supporting a call for ending 
the unions' monopoly in representing employees during collective 
bargaining.  France's extreme political left was "relatively strong" 
and Parisot feared it could exploit the issue in a way that would be 
"disastrous" for business. 
 
¶8. (U) Asked for her views on the Doha trade round, Parisot said 
MEDEF had encouraged progress in negotiations and was disappointed 
with the current state of affairs. Its membership had become more 
active in pressing its views during the negotiations, she said.  And 
MEDEF was becoming increasingly willing to "break taboo" and 
disagree openly with French agricultural union, FSNEA, on WTO 
issues. 
 
¶9. (U) In a brief exchange on "economic patriotism" Parisot said she 
had told Prime Minister de Villepin that she didn't necessarily 
object to the principle, as long as it didn't involve constructing 
commercial "Maginot Lines."  The truest form of "economic 
patriotism" would be to create a French policy environment that was 
as attractive as possible for doing business, she concluded. 
 
¶10. (SBU) Comment:  MEDEF's high profile end-August "summer 
university" and Parisot's comments at the September 6 off-the-record 
breakfast indicate MEDEF and the French business community will look 
to stake out a higher profile in the upcoming campaign than has 
traditionally been the case here.  (MEDEF has been somewhat the 
wallflower during the Doha Round and during France's CPE debate last 
spring.)  The upcoming presidential campaign will be as much about 
style as substance.  A key part of the substantive debate, however, 
will center on reform that calls for accelerated free-market 
liberalization (advocated by the center-right) as against reform 
that highlights continued, possibly increased, protections for those 
most likely to be the losers in market-driven change (advocated by 
the center left).  What the French call the "peoplization" of 
politics (i.e. the preponderant role of image in determining voters' 
choices) does complicate the MEDEF's intention to spark serious 
debate about the employment and investment practices of France in 
the 21st century.  However, such far-reaching debate, followed by 
 
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the making of a clear-cut electoral choice, is long overdue, and 
both the public and key leaders in the major political parties 
recognize that.  The MEDEF, if it does so with political sensitivity 
and sound argument, could play a key role in framing this debate for 
a French public by and large quite suspicious of business and 
dismissive of commerce. 
 
HOFMANN