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How France will invest €57 billion to modernize economy

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How France will invest €57 billion to modernize economy
14:38 CEST+02:00
The French PM announced details on Monday of how the government will invest €57 billion on bringing to life France's struggling economy. Here's a look at how the money will be spent.

Prime Minister Edouard Philippe announced plans Monday to pour 57 billion euros ($67.8 billion) into modernising
France's sluggish economy, with a hefty chunk set aside for making it more environmentally-friendly.

Spread over five years, the fund will be slightly bigger than the 50 billion euros that centrist Emmanuel Macron had pledged when he was elected president in May.

Philippe said the fund would have an "amplifier effect" on the new government's reform programme, which includes labour law changes designed to bring down stubbornly high unemployment rate of 9.5 percent.

"It's about giving power and visibility to our major investment priorities," Philippe told a press conference.

Twenty billion euros will be used to fund a transition towards a greener economy, Philippe said, including nine billion for making buildings more energy efficient and seven billion for renewable energy development.

In a bid to cut down on pollution, French drivers will be offered a 1,000-euro cash incentive to trade in cars made before 1997 -- or 2001 for diesel models -- for newer and more efficient vehicles.

The government will spend nine billion euros on digitising the public sector, 15 billion extra on training and education, including training one million people aged over 25 for new careers as Macron's government seeks to tackle long-term unemployment.

Around 13 billion will be spent on broader innovation, including five billion for modernising the agricultural sector in Europe's biggest food producer.

Another 3.5 billion of the innovation fund will be handed to scientists, including for developing the artificial intelligence industry.

Philippe said some of the funding would come from existing ministerial budgets and some from the European Investment Bank.

The launch comes as Macron's government prepares to announce the first budget of his five-year term on Wednesday.

 

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