France to Tax EDF Nuclear Output for Energy Shift to Renewables
Russia accused the West on Sunday of trying to exploit the deal between Moscow and Washington with Syria to push through a council resolution issued under Chapter 7 of the U.N. charter, which could authorise sanctions or military intervention if Damascus reneges on its commitments. Some U.N. diplomats, speaking on condition of anonymity, had expressed concern about whether agreement on a resolution could be reached. However, speaking to reporters in New York French Foreign Minister Laurent Fabius appeared to back down. “For it to be acceptable to France … the resolution should foresee that measures under Chapter 7 are taken if Syria does not comply with its commitments in line with the Geneva agreement,” Fabius said. He added the resolution should also call for those behind the chemical attack to face justice. “We should take exactly what was foreseen in Geneva,” Fabius said. “On that basis we should come to an agreement.” Fabius appeared to confirm France’s willingness to accept Russia’s demand that the current draft resolution not be enforceable under Chapter 7. According to the Geneva agreement, the Security Council would have to adopt a second resolution in order to punish Syria for any non-compliance with a U.S.-Russian plan to eradicate Syria’s chemical arsenal. Russia and the United States brokered the deal in Geneva in mid-September to avoid possible U.S. military strikes. Under the deal, Assad would account for his chemical weapons and see them destroyed by the middle of next year.
The lingering question is whether the nature of the industrial relations, which has historically been highly conflicted, can become more consensual? In addition, for the real wage to be more flexible and be more cycle-sensitive, the nature of working (fixed) contracts would also have to be changed. ii. Yet, most of the rebalancing between wages and profits goes through taxation/fiscal transfers. An easy way to do it would be through a lower corporate tax, which is close to the highest level in Europe. For understandable political reasons, this option in not in the cards. Among many other proposals, the National Pact for Growth, Competitiveness and Employment, lowers corporate taxation (tax credit), while the budget proposal for 2014 increases the VAT. This is the way France’s administrative rebalancing between profits and wages has to be understood: market forces might play a role in the medium run if more reforms are carried out, but in the short run most of the improvement in corporations’ relative GDP share should come through taxation and public transfers. Bottom Line: as the US is (still) facing a demand problem (excess saving by corporations, household deleveraging (nearing its’ end), and lower public spending through the sequestration), France has to deal with its supply side (low profitability of businesses, dwindling productive capacities, and insufficient innovation and price dependency). One way to correct those imbalances is to resort to market forces, but as the US case shows, the process can be significantly low with the absence of tax incentives. On the contrary, French authorities have decided to tackle the problem without resorting to any shock therapy on the labor side (flexibility and nature of job contracts) but rather through an administrative rebalancing that might also show some positive outcomes in the medium term. Don’t lose your faith in France.
France expects U.N. Security Council to agree Syria resolution
All change is expensive in the short term even if its beneficial in the long term, French Prime Minister Jean-Marc Ayrault said today in a speech about the environment in Paris. The nuclear levy will be applied to Electricite de France SA s existing atomic reactors, he said. The carbon tax will be introduced progressively on fossil fuels in order to earn 4 billion euros ($5.4 billion) in 2016. President Francois Hollande , who vowed during his election campaign to reduce reliance on nuclear to half of total output by about 2025 while also keeping down consumers bills, hasnt yet said how he will reconcile those aims. The country gets about three-quarters of the power it produces from EDFs 58 nuclear reactors, more than any other nation. The energy transition will cost an estimated 20 billion euros a year, Hollande said yesterday. Our nuclear fleet will be asked to contribute, Ayrault said today at the end of a two-day conference on the environment. The tax would apply over the remaining lifetime of our reactors. Frances Green party, which had said it would withdraw support for the Socialist government over the slow pace of policy initiatives, applauded the carbon tax announcement and new incentives towards home renovations for improved energy use. Ayrault didnt give details of how much EDF, which is 84 percent owned by the government, will have to pay. The utility is compensated for the higher cost of electricity produced by wind turbines and solar panels it buys through a tax on power bills called the CSPE. Carbon Tax The planned carbon tax, to be called a climate energy contribution, will be neutral next year and generate 2.5 billion euros in 2015 and 4 billion euros in 2016, Ayrault said. It will be applied to gasoline, diesel, coal, natural gas as well as heavy and heating fuels. Fishing and transport workers will be exempt from the levy while industrial plants that qualify for carbon quotas will keep their system, according to Ayrault. The governments policy announcements appear to be pragmatic, with very ambitious targets, some would even say hard-to-reach targets, said Jean-Pierre Clamadieu, who is chief executive officer of Solvay SA (SOLB) and was speaking for the business lobby Medef.
France cleared the use of frozen funds to export food to Syria
The European Union, United States and other Western countries have imposed sanctions on President Bashar al-Assad’s government over his crackdown on the revolt in his country, but these do not apply to food. Syria has been trying for several months to buy sugar, wheat and rice in international tenders using funds frozen abroad, in vain. One of the reasons cited by traders was a failure to secure permission from governments to free the funds. “Permits issued by the French authorities have been declared to the member states of the European Union and the Commission,” the spokeswoman told Reuters by email. The export of food commodities under these authorisations may be financed through frozen funds of Syrian banks affected by European Union sanctions, she added, but did not say when the permission was granted. The move by a European government to free Syria’s frozen funds removes a political hurdle to much needed food purchases, although traders say Damascus’ recent failures to buy food in public tenders may be more related to its tender terms. They say Syria’s attempts to buy food using frozen funds had been unsuccessful because it was still imposing the same purchasing conditions as in normal times with huge penalty payments if they were not met. France, which has been backing military action to punish Syria for a deadly chemical weapons attack, granted the permits to unfreeze Syrian funds due to the unprecedented food crisis hitting the country and its civilian population, the spokeswoman stressed. France is the European Union’s largest grain exporter. The EU executive was not immediately available to comment. (Additional reporting by Justyna Pawlak in Brussels; writing by Sybille de La Hamaide; editing by Muriel Boselli; editing by Keiron Henderson) Tweet this