France creates investment fund for 'strategic' enterprises
Paris, Oct 23 (DPA) The French government will establish an investment fund to support the country's strategic enterprises affected by the economic crisis, President Nicolas Sarkozy said Thursday.
The fund will make available loans to struggling companies in exchange for shares, which will be sold, presumably at a profit, once the company has stabilized.
The aim of the fund, Sarkozy said, will be to protect strategic companies 'from predators looking to profit from a firm's undervaluation' to take control of it.
'This will be a powerful tool of industrial policy,' the French president said.
Sarkozy urged other European countries to create their own national industrial funds so that industrial policy on the continent can be 'coordinated.'
'The economic slowdown has begun,' he warned. 'We must respond.'
The French president also announced the suspension of a trade tax for all new business investments beginning Thursday and running until the end of 2009.
The central government will compensate for losses to local governments to which the tax is paid. The daily Le Monde reported on its online edition that this amounts to about one billion euros ($1.29 billion) a year.
In addition, Sarkozy announced the creation of the post of credit mediator, whose function will be to facilitate an enterprise's access to bank loans.
'I want all companies that have credit problems with banks to be able to call the mediator,' Sarkozy said.
Le Monde had reported Wednesday that the French president envisioned himself as remaining in control of European economic policy for at least another year as head of the eurogroup.
'Europe needs a trade policy, Europe needs an industrial policy, Europe needs an economic policy,' Sarkozy said.
The crisis, he said, 'is the veritable beginning of the 21st century, when everyone realized it was time to begin anew with new
principles and new rules.'
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