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Macron on course for another race to overhaul the French economy

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(Bloomberg) — French voters will decide this month whether they want to give Emmanuel Macron another chance to review the country’s economic and social fundamentals.

The independent centrist won over the French in 2017 by promising to improve the business environment with tax cuts and encourage work with changes to labor laws and social protection. But after a flurry of action in the first year of his presidency, this campaign for reform was slowed by the yellow vest movement and halted by the Covid pandemic.

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Pollsters predict that after winning the first round on April 10, Macron will face and likely defeat nationalist candidate Marine Le Pen in the second round on April 24. If they are right, then these are the key policies that will shape France for the next five years. — knowing that the war in Ukraine casts a shadow over the feasibility of some of its projects.

Tax policy

► Taxes

The French leader said he would continue to cut tax rates to stimulate economic activity and ease the tax burden on labour.

For companies, it provides for further reductions in levies on production and reductions in charges for the self-employed. For households, it undertakes to abolish the television license fee and to raise the ceiling on the tax exemption for inheritances.

The cuts would cost the state a total of 15 billion euros ($16.5 billion) when fully implemented.

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► Expenses

Macron plans to set aside 10 billion euros for the green transition, which would include renovating buildings, subsidies on electric vehicles and planting trees. Education and health are also in line for a boost from public investment.

Combined with the tax cuts, the total cost of Macron’s program would reach 50 billion euros per year by the end of a five-year term in 2027. In the manifesto, there are few details on the specific measures under the main headings of the modernization of the State, the reduction of operating costs and the reduction of local authority expenditure.

Overall, Macron’s team says the budget deficit would still fall below 3% of economic output by 2027, in line with his current government’s forecast. The plan is based on optimistic assumptions about growth and the impact of reforms on the country’s long-term growth potential.

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social policy

► Work

Macron sticks to the mantra that guided economic policy-making during his first term: making work pay. Certain measures could prove to be popular, such as tripling the tax exemption for the bonuses that he introduced during the Yellow Vests demonstrations, guaranteeing a childcare solution for all, strengthening the profit-sharing mechanisms or introducing more flexibility on the vacation days.

Beyond these carrots to make work more attractive, there are also sticks that can prove to be red flags for French unions. Macron says he would add conditions to the minimum level of social protection and modulate the generosity of unemployment insurance according to the strength of the labor market.

According to the manifesto, the changes would drop unemployment to 5% – a level not seen since the late 1970s.

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► Health

Macron wants to encourage the production of medicines in France, after facing shortages during the Covid crisis, and organize a conference on how to ensure that there are no “medical deserts”, areas without doctors.

To improve the quality of life of the elderly, he wants to recruit retirees to give their time in various fields, ranging from helping children with their homework to advising entrepreneurs. It also undertakes to reserve 1,100 euros per month as a floor for the pensions of those who have worked all their lives. Following reports of abuse in nursing homes, he plans to recruit more caregivers.

► Retreats

When Covid plunged France into recession in 2020, Macron put plans to overhaul pensions on hold. The main difference in his new proposal is a clear commitment to raising the retirement age from 62 to 65 – something he ruled out in his 2017 manifesto – rather than focusing on abolishing a multitude sectoral rules to create a single system. While still aiming for a certain simplification, the new plan no longer focuses solely on the unpopular idea of ​​abolishing a multitude of rules and sectoral advantages.

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The changes he proposes would do much of the heavy lifting for the rest of his economic framework by increasing state revenue, cutting spending and boosting the country’s growth potential.

► Education

Of the 12 billion euros invested in education, half of this sum will go towards increasing the salaries of teachers for those who are starting their careers and those who wish to change the way and where they work. Schools would also gain greater organizational autonomy and hiring power.


Macron has made a clear commitment to nuclear power by pledging to build six next-generation reactors. It also promises a 10-fold increase in solar power and the construction of 50 offshore wind turbines by 2050. This could involve the state taking over some assets of Electricité de France SA, Macron said.

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The manifesto also sets out regulations to improve carbon footprint labeling of consumer goods and a requirement to link executive compensation to their company’s social and environmental goals. Macron wants to renovate at least 700,000 homes a year to help reduce energy consumption.

Security and Defense

Macron plans to continue to strengthen policing on the ground with 200 new gendarmerie brigades in rural areas and action forces including teachers and magistrates for the poorest suburbs. To fight against cybercrime, the State would hire 1,200 specialists and create filters to warn Internet users.

To keep military spending at 2% of economic output, he presented a plan to modernize the army with more jet planes, nuclear-powered submarines and armored vehicles.

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Macron has pledged to “continue to fight radical Islam” by closing some mosques that do not adhere to a charter of accepted behavior, expelling preachers and closing schools. He also wants to create a new border force and speed up the process of illegal deportation of people in the country.

Foreign Affairs

Macron takes the pro-European Union stance that proved successful in the second round against Le Pen in 2017.

In the name of strategic autonomy, he calls on the EU to massively increase its defense capabilities and coordinate its national armies. It seeks to build a European version of the Metaverse, a network of 3D virtual worlds that US-based Meta is working on.

Macron made it clear that Europe should maintain economic pressure on Russia after the war in Ukraine while avoiding verbal escalation against Vladimir Putin to keep all channels open for discussion. He also wants the bloc to move away from Russian oil and gas in the long term and take in a share of Ukrainian refugees.

Read more: France’s stunning economic rebound could seal Macron’s re-electionHow Macron’s campaign was boosted by the war in Ukraine

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