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Last Updated: Thursday, 25 August 2005, 22:40 GMT 23:40 UK
Motorway auction sparks political row
By Catherine Guilyardi
In Paris

French toll road
Many drivers are loath to pay foreign firms to drive in France

As this year's summer holidays draw to a close, the French people will for the last time be making their journeys home on motorways that they partially own.

As taxpayers, the French collectively hold majority stakes in Europe's most extensive autoroute network.

But not for long.

This week, the government announced that its efforts to auction off the state's shareholdings in three of the country's motorway networks were going according to plan.

Except, that is, for a political backlash that is threatening to cost the newly appointed government the loyalty of some of its closest political allies.

"When those motorways where built, we were told that once they were paid off they would be toll-free, as they are in the US and in Germany," points out the leader of the UDF centre-right party, Francois Bayrou, vowing that he will do everything in his power to block the motorway privatisation bill from being passed by parliament.

Future earnings

Built by the state and run by private operators, the 8,000-kilometre (5,000-mile) motorway network has become an object of pride for the French people - a fact not lost on many of the politicians who represent them.

WHAT'S FOR SALE?
French motorway
50.3% of ASF
70.2% of Autoroutes Paris Rhin Rhone (APRR)
74.3% of Sanef

Using language considerably hotter than the cold weather currently sweeping across France, one has even called the autoroutes a part of France's "national heritage" while another insisted that the "great scandal with the privatisation of toll companies, when compared with other privatisations, is that it is like privatising public taxes".

Many drivers fear that toll road charges would rise following a sell-off, and describe the government's promised two-year freeze on prices as short-sighted.

Others wonder what will happen to infrastructure projects like the long-awaited fast TGV train from Paris to Strasbourg. For years, finance for such projects has come from the toll roads.

So in short, the sale of "the family silver" is not merely a matter of sentimentality, according to Mr Bayrou. He insists the stakes in the autoroutes should be retained in order to provide the government with much-needed income in the years ahead.

"The stakes are the only goods in the hands of the state that can provide it with considerable sums of money," he declares.

In 2003, such logic caused former Prime Minister Jean-Pierre Raffarin to scrap plans to sell the motorways.

At the time, Mr Raffarin said the benefits from a sale would have been smaller than future toll road earnings which, according to one estimate, are set to rise to a whopping 40bn euros ($44bn; 27bn).

Economic nationalism

That, however, would not happen until 2032, when current concessions come to an end.

And as is often the case, long-term financial planning can be desperately difficult when faced with an immediate cash crunch.

The French government, which must sort out its budget deficit in order to comply with commitments made to its European partners, simply cannot afford to wait.

The 10bn to 14bn euros Finance Minister Thierry Breton hopes to raise from the auction should go a long way to help eradicate the deficit.

But, observes Eurosceptic Nicolas Dupont-Aignan in a Le Monde article; it will be French drivers who will end up footing the bill. Car drivers will pay a little towards the maintenance of the motorways and a lot towards paying off the 2005 budget deficit, according to Mr Dupont-Aignan.

Many French drivers are also unhappy about the prospect of paying foreign companies for the privilege of driving on French roads.

UMP Patrick Ollier, president of the parliamentary economical affairs commission, told the business weekly Les Echos that he hoped a majority of the stakes will remain French.

Such comments have angered the government, which is eager to stress that it has appointed an independent observer - former French banking commission head Jean-Louis Fort - to ensure the auction is fair and transparent, and that it does not discriminate against foreign bidders.

Yet France's neighbours are upset. Spain's El Pais newspaper has expressed concern about French "anachronistic economic nationalism".


SEE ALSO:
Critics slam French motorway sale
23 Aug 05 |  Business
Paris mulls early motorways bids
22 Aug 05 |  Business
France set for motorway sell-off
15 Jul 05 |  Business
France dumps motorway sell-off
18 Dec 03 |  Business
France hit by massive strike
13 May 03 |  Business
Autoroutes' shares race on debut
28 Mar 02 |  Business


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