Hollande Opens Year with Promises of Tax Cuts, Redeployment from Mali

A French soldier en route to Mali in a US Air Force C-17 Globemaster. The United States is providing support for French military actions in Mali by airlifting troops and equipment. Photo: Staff Sgt. Nathanael Callon for Wikimedia Commons.

A French soldier en route to Mali in a US Air Force C-17 Globemaster. The United States is providing support for French military actions in Mali by airlifting troops and equipment. Photo: Staff Sgt. Nathanael Callon for Wikimedia Commons.

French President François Hollande has vowed to sharply cut French troop levels in Mali while tackling unemployment at home, as part of his package of New Years’ promises to the French people.

Hollande promised on January 8 to reduce the number of French troops in Mali to 1,600 by mid-February. France currently has 2,500 soldiers deployed to keep the peace in the struggling West African country.

Hollande further promised that France would cut its troop levels to 1,000 by the end of 2014, a number he described as “the necessary level to cope with any threat that could reappear” in Mali.

France began its military campaign in northern Mali on January 11, 2013, at the behest of the battered Malian government and backed by a United Nations Security Council resolution. At time, Mali was on the brink of collapse: The Salafi militant group Ansar Dine had seized control of the north of the country, and a military coup had removed the civilian government in Bamako.

Since the intervention—codenamed Operation Serval—began, a multinational task force has helped the Malian government reestablish control over the north. Over the past year, all major cities in northern Mali have been brought back under government control.

Despite Operation Serval’s apparent success, jihadism in West Africa is far from dead. Earlier this week, the Senegalese militant group Mourabitounes promised to carry out attacks against French interests in retaliation. While West African jihadists have not been linked to any attacks in Metropolitan France, dozens of French expatriates have been kidnapped and ransomed in the region. Some have been killed in captivity.

The intervention in Mali is just one of France’s many military expeditions in its former African colonies. France has long viewed itself as the guarantor of stability in Francophone Africa: Even as the Mali intervention begins to wind down, French troops have been deployed as peacekeepers to the war-torn Central African Republic.

On the domestic front, Hollande promised fiscal reforms as part of a “responsibility pact” to the recession-weary French public. In his New Year’s Eve address, Hollande called job creation his “one objective, one priority, one engagement.”

Hollande said that his administration would offer tax benefits and greater flexibility to businesses that hire more employees. Unemployment in France has remained stubbornly high at 10.9%. Germany, by contrast, has kept unemployment at a modest 5.2%.

Hollande offered no concrete details on how the tax incentive would be implemented. However, it follows promises from Prime Minister Jean-Marc Ayrault that the French tax code would be overhauled.

French employers face very steep labor costs, due to social welfare expenditures that the French government forces businesses to pay. These surcharges boost the cost of hiring by an estimated 34 cents on the euro.

As concerns mount about France’s ability to compete in the future with economic giants Germany and China, Hollande has begun to address labor flexibility. Last May, the Hollande administration reached a deal to loosen labor regulations in exchange for more hiring.

That compromise, however, is primarily focused on employees’ short-term benefits. The reforms made it easier for businesses to dismiss workers and to cut their hours or pay in response to falling revenues. Since their enactment, unemployment has remained high, while Hollande’s approval ratings have steadily plummeted.

Hollande’s tax relief promises are likely to meet with skepticism from a disaffected electorate. Despite his Socialist affiliation, Hollande has followed predecessor Nicolas Sarkozy in freezing spending while boosting taxes in the name of budgetary stability. As the economy has slowed down, France’s higher taxes have drawn increasing public resentment.

French taxpayers have had reason to be skeptical of Hollande’s promises. Even as he spoke of tax credits, French households and businesses saw their taxes rise yet again on New Year’s Day.

Trackbacks

  1. […] overhaul was done in two phases. During his New Year’s Eve wishes to the nation, Hollande attempted to gauge public opinion. He proposed a “pact of responsibility” between the […]

  2. […] Hollande Opens Year with Promises of Tax Cuts, Redeployment from Mali. French President François Hollande has vowed to sharply cut troop levels in Mali while tackling unemployment at home, as part of his package of New Years’ promises to the French people. Hollande promised on January 8 to reduce the number of French troops in Mali to 1600 by mid-February, a significant drawdown from the 2500 currently deployed to keep the peace in the struggling West African country. Hollande further promised that France would cut its troop levels to 1000 by the end of 2014, a number he described as “the necessary level to cope with any threat that could reappear” in Mali. […]

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