Président Macron’s government to sell Paris’s airports

I was most impressed with a journalist’s summation on France 2 of the proposal by Président Macron’s government to sell Paris’s airports. They are currently owned by just a shade more than 50% by the state..

The Prime Minister has said it is not part of the government’s purpose to extract dividends from infrastructure. Though without offering further explanation.

On the grounds that the airport might be completely privatised, people seem to be worried that security would be based not on the State but on market forces. To Brits this must seem to be something of a premonition. I imagine the French, too, have got to know the wonderful successes that are Serco and G4S….. Still, the French are always particularly security conscious. (The same programme features a suite where rape victims are supposed to feel more at ease – they show it has at least two policemen guarding it with sub machine guns, which to me is the contrary of feeling secure! I’m reminded, rather ironically, of a frighteningly clear-seeing yet still delightfully nonchalant cartoonist at ‘Charlie Hebdo‘ who was not present on that fateful day when most of his colleagues were gunned down. There was a knock at the door soon after and when the caller offered Police protection he declined, saying that it hadn’t done his colleagues much good had it? I’m rather glad I wasn’t the one knocking…)  Anyway, in spite of concerns, there is no reason why state Police and troops cannot patrol a private airport.

The Prime Minister was reported as considering that the state is not required to be rent seeking (implying -perhaps accidentally – that private ownership was) but he actually said thet it is not the role of the state to be obliged to receive dividends instead of investing! So given that, unfortunately, France doesn’t really have its own currency, a sale could be seen as a way of raising investment monies.

The journalist continues: the airport is “une entreprise rentable” (which needs no translation) and shares earn 4% a year. Why sell them? Why not preserve them for the benefit of the French taxpayers (and remember as France is in the Euro, France has for the moment at least, to tax and spend). Paris airports, he adds, are also in effect a natural monopoly. He goes on to compare it with the privatisation of the auto-routes where prices increase on a regular basis and the taxpayer has lost out on a profitable income.

His conclusion is that the sale is because France wants to reduce its debt, in accordance with the European Central Bank’s ‘stability pact’. France pays just 0.9% on the debt, yet is selling something which gives them a return of 4%!

Would that the BBC could be as clear-sighted and incisive.

I’d give that journalist the légion d’honneur, but I doubt Président Macron will be as impressed…

Comments

  1. Geoff -

    Hi Peter
    I was reading in “The Local fr” the Chinese already own 49.99% of Toulouse airport, the fifth largest in France, and near to where we live, it’s currently expanding capacity. Casil Europe, a holding company created by China’s state-owned Shandong, Hi-Speed Group and the Hong Kong-based Friedmann Pacific Asset Management, bought 49.99 percent of the airport in 2015.
    The French government has an option for selling Casil an additional 10.01 percent stake from April, as part of a wave of sales of state-owned assets. But in December a group of local officials asked Prime Minister Edouard Philippe to refrain from selling the stake, accusing Casil of using the airport’s cash reserves to maximise dividend payments instead of investing in its operations. (where have we heard that before!) Look like cheap flights to China could be on the cards.
    President Macron has vowed to raise 10 billion euros by selling state assets and stake-holdings to fund a program to promote innovation. Energy giants EDF and Engie could also come under the hammer as part of his program….. European neoliberalism is alive and kicking.

  2. Peter May -

    Agreed, Macron is an odd mixture of financial ultra conservative and radical. Not unlike New Labour I suppose…

  3. Geoff -

    What I find confusing is this: as I understand it, throughout the EU, individual Member States are prevented from giving competitive advantage and from purchasing assets for the good of its citizens, 2008 melt down being the exception to massive intervention, which was really corporate welfare.
    yet a country like China is allowed to enter the European markets and buy up airports and other State owned assets without the same restrictions. I recently discovered the Chinese have been purchasing a number of french farms and the surrounding land for the production of wheat destined for China to feed their ever growing population. I believe this went unnoticed until reported in the La Depeche newspaper.

    I understand the motive that is driving privatisation of Public assets in the EU but I have a problem understanding why they regard China as being an acceptable buyer of our assets, perhaps your contributors can help me out?

  4. Peter May -

    I’d be delighted if anyone else has other ideas but I’m not sure theEU/governments think that deeply!
    In the end almost everywhere has a trade deficit with China, so I suppose you end up with ‘because China has the money’!

  5. Marco Fante -

    Ultimately, there is no excuse for selling monopoly public assets into private hands, especially not when there are critical national interst and security issues involved.

    As for this:

    ” France pays just 0.9% on the debt, yet is selling something which gives them a return of 4%!

    Well,that’s just plain corruption and I am confident that a relatively low selling price (should this sale actually occur) would confirm that conclusion.

    I would start checking Macron’s connections to the likely beneficiaries.

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