France bets on high speed in its recovery plan

National recovery plans have started to reach Brussels. And throughout this week we will be shelving them in our program The Brief from Brussels.

We start with the French plan whose total amount is 100,000 million euros.

The French government has asked Europe for aid worth 40.9 billion euros in non-refundable subsidies, and does not plan to use the credits that the European Recovery Plan also provides.

To access this aid, governments must dedicate 37% of spending to climate and 20% to digital transition. And to convince the European Commission, France has gone further: around 50% of its funds will go to the environment and 25% to the digital economy.

Bet on the railroad and green mobility

Paris has put the emphasis on energy renewal and green mobility. “Paris insists a lot on the railways, while in Germany there is more talk about electric cars, which are more related to German industry. And it is logical since the place that high speed occupies in France is well known”, explains Grégory Claeys, a researcher at the Bruegel Institute.

The French government also makes a difference by incorporating an axis of cohesion and training into its strategy. “I find it useful because if we want to promote a green transition and a digital transition, it is important to work on training and on the job changes that will take place,” adds Claeys.

France has also accepted the introduction of structural reforms in its recovery plan. Although it is not possible to speak of a rupture but rather of continuity with respect to the commitments that the government had acquired. For example, the review of the unemployment benefit had been suspended due to the pandemic.

On the eve of the presidential campaign

It is also important to take into account that the presentation of the plan occurs one year before the presidential elections, so it will serve as an electoral roadmap for outgoing president Emmanuel Macron.

“The plan is also a communication plan aimed at the French, to show that France has contributed to moving the lines a bit at the European level. It was one of the main elements of Macron’s program during the last presidential elections and will surely continue to occupy a featured prominently in the upcoming ones, “says Claeys.

However, the results will not be palpable during the campaign. The Commission has given itself a period of two months to approve the national plans and, if all goes well, the first disbursements could arrive in the coming months. But the bulk of European funding is not expected before 2023.