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The parallels are often made between France now and Britain in 1979: both economies had experienced a long period of under-performance with associated labour unrest. We had then what was in effect a revolution - a set of searing reforms that, at considerable cost, laid the base for the subsequent boom... The parallel is seductive but only helpful at the most  general level. Britain's relative position in 1979 was much worse than France's now... The better parallel is Germany five years ago...

 

The most fascinating thing I always feel about the French economy is not the high levels of regulation and taxation but how good the private sector, large and small, is at coping with these. Its large companies have gone global. Did you know that French companies supply London with electricity and the US army with catering services? Meanwhile, its small companies manage to crank out high quality goods and services using very few staff, achieving among the highest productivity in the

world.

 

Of course not all French companies are great, but the general level is impressive given how strongly they have been held  back. It is almost as though they are a coiled-up spring waiting for regulation to be released. And that is what Nicolas Sarkozy has undertaken to do.