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article imageBusiness worries for France ahead of new 'yellow vest' protests

By Adam PLOWRIGHT (AFP)     Dec 14, 2018 in World

Fears grew about the economic impact of France's month-long "yellow vest" protests on Friday ahead of a decisive weekend for the grassroots opposition movement and President Emmanuel Macron.

The survey of businesses released by the IHS Market research group on Friday showed a surprising dip in activity in December linked to the disruption caused by the nation-wide demonstrations.

"The latest flash data pointed to an outright contraction in France’s private sector for the first time in two-and-a-half years," IHS Market economist Eliot Kerr warned.

Macron's centrist government is hoping that concessions announced on Monday, a terror attack in Strasbourg on Tuesday and freezing weather this weekend will deter demonstrators from taking to the streets again.

France "needs calm, order and to go back to its normal functioning," President Emmanuel Macron said in Brussels in Friday.

But many of the "yellow vest" figureheads, so called because of the florescent high visibility vests they wear, have called for a fifth round of protests on Saturday, sparking fears of more clashes.

"It's really the time to keep going," a senior figure in the movement, Eric Drouet, said in a video posted on Facebook. "What Macron did on Monday, was a call to carry on because he has started to give ground, which is unusual for him," he added.

'Yellow vest' protestors take notes as they watch French President Emmanuel Macron's ...
'Yellow vest' protestors take notes as they watch French President Emmanuel Macron's speech on television
GUILLAUME SOUVANT, AFP

Drouet was referring to Macron's address to the nation on Monday, billed as the most important speech of his presidency, in which he offered a range of concessions to the demonstrators.

The "yellow vest" protests began on November 17 in opposition to hikes in fuel taxes, but have since snowballed into broad resistance to Macron's pro-business agenda and his style of governing.

The 40-year-old head of state, who had already cancelled planned fuel tax hikes, offered a rise in the minimum wage, tax relief for pensioners and tax-free overtime work for workers in 2019.

The total package has been estimated by economists to cost up to 15 billion euros ($17 billion), which is expected to be financed mostly by government borrowing.

A fall in economic growth, which would hit tax receipts, would exacerbate the government's budget problems.

"The more the movement continues, the more it will be a loss for the French economy," the governor of the French cental bank, Francois Villeroy de Galhau said in an interview with Les Echos newspaper on Thursday.

The central bank has lowered its growth forecast for 2018 to 1.5 percent, saying expansion in the current quarter would be 0.2 percent, instead of 0.4 percent as previously forecast.

- Police on alert -

Six people have died since the "yellow vests" movement began and more than 1,400 have been injured in the protests by mostly low-income people from small-town and rural France.

Scenes of blockages, massive traffics jams and mobs rampaging through the streets of Paris have dented France's image, as well as Macron's hopes of forcing through more business-friendly reforms.

It is unclear whether as many "yellow vest" protestors will turn out as on previous weeken...
It is unclear whether as many "yellow vest" protestors will turn out as on previous weekends
Zakaria ABDELKAFI, AFP/File

The numbers of "yellow vest" protesters in the streets have been relatively small by French standards -- only 136,000 last weekend -- but until now they have benefited from overwhelming public support.

The impact of Macron's concessions, plus a terror attack in the city of Strasbourg on Tuesday evening, could be crucial in determining whether the movement peters out this weekend or continues.

Two polls published on Tuesday showed that the country was split broadly 50-50 on whether the "yellow vests" should continue protesting, a fall of around 20 percentage points.

On Tuesday night, a 29-year-old jihadist from Strasbourg in eastern France attacked the city's Christmas market, killing four and injuring 12 in a gun and knife rampage.

He was shot dead by police on Thursday night after 48 hours on the run, leading to praise for France's highly stretched security forces which have been repeatedly targeted during the protests.

"I find it inadmissable that today we are applauding our police and then tomorrow some people think it's ok to go and throw stones at them," Interior Minister Christophe Castaner said on Friday in Strasbourg.

The protests have sometimes turned violent  with police also tear-gassing demonstrators
The protests have sometimes turned violent, with police also tear-gassing demonstrators
Fred TANNEAU, AFP/File

Around 8,000 police will be on duty in Paris on Saturday, around the same number as last weekend, backed up with 14 armoured vehicles, water cannon and horses.

Around 90,000 security forces were mobilised last Saturday across France when 2,000 people were detained, around half of them in Paris.

On Thursday, government spokesman Benjamin Griveaux called on "yellow vests" to stay at home.

"It would be better if everyone could go about their business calmly on Saturday, before the year-end celebrations with their families, instead of demonstrating and putting our security forces to work once again," he said.

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